Salvador Perez' five-year extension, long before his contract is over is intriguing to many. Some like it while some think it's incredibly stupid, but one thing that it definitely is.... is different. SB Nation's Grant Brisbee is intrigued by the deal made between the Royals and the young catcher as it could be a good thing for both sides or bad for one or the other.
He never made Baseball America's top-100 prospects. Before the 2011 season, John Sickels ranked him as the Royals' 18th-best prospect in a very deep system. His defense is said to be impressive, but by all rights, this should still be a player the Royals are still figuring out.
Instead, the Royals locked him up for five years, buying out two of his arbitration seasons. There are three team options after that for a total of $14 million. It's essentially a 5/$7 million contract that can turn into an 8/$21 million contract (with incentives) if Perez develops well.
On one hand, this contract could work out for both sides. Perez could turn out to be a good, not great, but good catcher and if that's the case, his long-term contract doesn't overpay him that much. But what if he's bad? The money poured into him would be waisted. And if he turns out to be a superstar? He's locked into a long term deal that would keep him massively underpaid.
Over the next five years, the Royals will pay at least $2.5 million for a backup catcher. That's if they pull someone up from their own system, dredge up a minor-league free agent, or promote their bullpen catcher. So if you assume that Perez can, at the very least, be a backup catcher, the Royals are gambling $4.5 million over those five years that he can be something more. That's just above the going rate for a generic starting catcher. Ramon Hernandez signed this offseason for two years, $6.4 million, and he's like 80.
Perez gets $7 million, guaranteed. After taxes and agents, he'll probably pocket $4 million of that. That would go a long, long way if he were to contract leprosy or be unable to perform even as a competent backup in the majors. And his worst-case financial scenario -- that he breaks out, becomes a star, and has to wait eight years to test the market -- will be punished with additional millions. He took a risk, but the safety net was many millions.
The Royals locked up a player who could be something special. Or they locked up a serviceable catcher for just above serviceable-catcher rates. The risk is almost negligible.
It will be interesting to see if this unusual contract will become a trend in Major League Baseball, or if it's just a weird isolated case.
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