Royals Extend Salvador Perez

By now I'm sure all of you have heard the news; the Royals have extended catcher Salvador Perez. The deal is for a guaranteed five seasons, with club options for 2017, 2018, and 2019. Here is a breakdown of the money and the fWAR he'd have to produce for the Royals to break even:

Year: Money-WAR

2012: $750,000- 0.2

2013: $1,000,000- 0.2

2014: $1,500,000- 0.3

2015: $1,750,000- 0.4

2016: $2,000,000- 0. 4

2017*: $3,75,000- 0.8

2018*: $5,000,000- 1.1

2019*: $6,000,000- 1.3

$21,750,000- 4.8

Incentives: $5,000,000- 1.1

Total: $26.750,000- 5.9

Obviously you can debate how accurate 1 WAR is worth, but by using fangraphs 1 WAR per every $4.5 million on the open market, here is what Salvador Perez would have to do in order to return market value. Unfortunately, in this situation the open market isn't the best way to evaluate Salvador Perez. The reason is because for the next three years he was going to be paid the league minimum regardless. The following three seasons his salary would have been reflect of his market value on a 40-60-80 scale.

We could go into hypotheticals in order to estimate Perez's pay depending on different levels of performance. Instead I am going to use a comp, for this case let's use Miguel Montero. (This is the player I had been using for Perez's arbitration figures in my payroll estimates for future seasons.) 

Montero made $2 million in his first year of arbitration, and $3.2 million in his second. If he keeps up his current pace he'll be due around $5 million for his final season of arbitration. For his three arbitration seasons, Montero should make around $11-13 million during his team controlled seasons. Perez will make $10.75 mill.

Maybe a better comparison for Perez would be defensive first catcher like Yadier Molina. In Molina's first six seasons he made $10.69 million. However, during those first six seasons Molina was never able to post an OPS above .750. I think Molina's a great comparison for Perez, but after a season that saw him hit .331/.361/.473 (albeit in 158 PA), I think most of us hope that Perez will do more with the stick than Yadi.

Of course the big draw to the contract, isn't obtaining cost control through Perez's team controlled years. (Although, if he develops as the Royals hope that will be a HUGE bonus as well.) The huge part of this extension is the Royals ability to control Perez through 2019. The Royals have club options for the final year of arbitration and two of Perez's free agent seasons. 

If Perez totally tanks the Royals are out around $7 million. (Less than the one year contract Edwin Jackson just received.) If Perez is simply Alcides Escobar with the bat, but a stud defensively this deal could be extremely fair. If Perez turns into the Hall of Famer that Art Stewart predicts, this deal will look like one of the most team friendly contracts in the history of the game.

Earlier this off-season, I thought there were two players that would be great candidates for extensions that were under the radar: Salvador Perez and Alcides Escobar. My rationale was that even if they struggled with the bat their defense would be strong enough to carry them through at least part of the deal. Both of these players are at defensive oriented positions and if they continue to be studs they can return fair value simply with their gloves.

The second reason, that I believed both would make good candidates is that neither were bonus babies. Any extension would be a life changing sum of money. Not that the sum wouldn't be life changing for Hosmer or Moustakas, but the fact that they are already millionaires makes it a bit easier to turn down a major offer.

In the Dayton Moore era, the argument can be made that the Royals have extended every deserving player, not name Alex Gordon (fingers crossed). However, these extensions have all occurred post arbitration. Prior to today, the Royals hadn't agreed to a player extension of this type. The fact the Royals have now completed one, tells me that they aren't just paying lip service to the idea.

Whether or not Scott Boras would allow Eric Hosmer or Mike Moustakas to sign an extension of this type is up in the air. But as of now we know for sure that the Royals would be open to one. I'm aware that it takes two to tango, but tonight I feel more optimistic than I did twenty-four hours ago.

Photo taken from MinorLeagueBall.com.