Orioles' extension for Hardy is good bet in weak shortstop market
The Orioles still have plenty of baseball to play, but already they've begun taking care of some offseason business. On Thursday night, they announced that shortstop J.J.Hardy has signed a three-year, $40 million extension with a vesting option for a fourth year, a move that will have a sizable effect both on the winter free agent market and the shape of Baltimore's lineup.
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Hardy, who turned 32 on Aug. 19, did not have his best year at the plate, batting .268/.309/.372 en route to a 93 OPS+. After averaging 26 homers a year for his first three seasons in Baltimore, and 18 per 162 games for the first nine seasons of his major league career, he didn't hit his first of 2014 until June 21, and finished with just nine, his lowest total since 2010. His .104 isolated power was by far a career low; his lifetime mark is .161 (on .261/.312/.422 with a 96 OPS+).
Both Hardy's walk rate (5.1 percent) and strikeout rate (18.1 percent) moved in the wrong direction; where he has posted a career strikeout-to-walk rato of 2.1, he was up to 3.6 this year. Lower back spasms that bookended his season — limiting him to 33 games in April and September but never sent him to the DL — may have had an impact on his reduced offensive output.
For all of that, Hardy was still right on par with the average major league shortstop as a hitter (.255/.310/.368) and well above average in the field according to both Ultimate Zone Rating (+14) and Defensive Runs Saved (+10). Those were no flukes, either; he's been about 10 runs above average per 150 games for his career according to both metrics, and the Gold Gloves he won in 2012 and 2013 were well-earned. His 3.4 Wins Above Replacement mark (Baseball-Reference.com version) wasn't far off from the 3.8 he averaged over the previous three seasons.
Over the past four years, Hardy has been worth 14.7 WAR, second among all shortstops behind Troy Tulowitzki (17.3); trim the window to three years and his 10.6 WAR is fourth behind Andrelton Simmons (13.3), Tulo (11.2) and Ian Desmond (10.7). His production has been well worth the $7 million the Orioles paid him as part of a three-year, $22.5 million extension he signed in July 2011.
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An over-30 shortstop whose body and bat may be in decline doesn’t sound like a great bet for a multi-year deal, but even at roughly double his average salary, Hardy will be a bargain if he can continue to be a three-win player over the life of the pact, which via the Baltimore Sun's Dan Connelly breaks down as follows: salaries of $11.5 million for 2015, $12.5 million for 2016 and $14 million for 2017, with a $14 million club option and $2018 million buyout for 2018. That option can vest with a certain number of plate appearances or a trade during the deal's duration. He can also receive up to $700,000 worth of performance bonuses in each year, and via MASN's Roch Kubatko, $6.5 million of the guaranteed money is deferred, lowering its present-day value.
Hardy has avoided the disabled list since April 2011, when he was sidelined by an oblique strain, and though his recent back issues shouldn't be dismissed, his signing carries less risk than last winter's four-year, $53 million deal for Jhonny Peralta, who was coming off a 50-game suspension for performance-enhancing drugs and is three months older than Hardy. The contract looks particularly shrewd given this winter's free agent market for shortstops, not only in light of the alternatives but also the larger checks that teams with shortstop vacancies like the Yankees and Dodgers can write relative to those of the Orioles.
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Hanley Ramirez will be the biggest name among the options thanks to his strong bat (.283/.369/.448 this year), but his defense (-9 DRS) and injury history — under 100 games played in two of the past four years, and 214 over the past two — make him a huge risk on a long-term deal. He's better suited to another position, though he didn't take to third base (-11 DRS in 98 games in 2011-2012) the first time around. Barring complete general managerial incompetence on the part of Ned Colletti — since Ramirez on a one-year, $15.3 million qualifying offer is a best-case scenario — he'll also cost a team a first-round pick.
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Like Ramirez, both Asdrubal Cabrera (-33 DRS over the past two seasons) and Jed Lowrie (-31 DRS over same) are better suited for other positions, and they offer far less with their bats. Cabrera, who finished the year as the Nationals' second baseman, has hit just .241/.303/.394 en route to 2.2 WAR over the past two seasons. Lowrie sank to .249/.321/.355 and 0.8 WAR this year after a stronger 2013.
Further down the list, Stephen Drew spurned a qualifying offer from the Red Sox last winter, didn't return until June and hit a wretched .162/.237/.299 in 300 plate appearances split between the Sox and Yankees, the latter of whom shifted him to second base. His total of 4.3 WAR over the past four seasons kills whatever hope remained for a Peralta-like deal, and he almost certainly flunked his audition to succeed Derek Jeter. Clint Barmes' age (36 in March) and weak bat (.224/.271/.314 in three years as a Pirate, the last of them only in reserve) rules him out as a full-time option, and the same goes for Mike Aviles (34 in March, .250/.277/.356 in two years in Cleveland).
Hardy's deal would appear to shut down the possibility of returning Manny Machado to his natural position, something that appeared likely when the latter first broke in as the incumbent shortstop's free agency loomed. Then again, Machado has been stellar at third base (+48 DRS in 289 games), and having ended two seasons in a row with kneesurgeries, moving him back to a more demanding position where he's more vulnerable to contact carries some risk. Healthy, the Machado/Hardy tandem may form the best defensive left side of the infield in the game, reminiscent of the storied Brooks Robinson-Mark Belanger combo that powered the Orioles' run of success in the 1960s and 70s.
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Though he was unable to work out an extension in the spring and didn’t want to negotiate during the season, Hardy had made clear a willingness to stay, and manager Buck Showalter — who values his leadership as much as his production on both sides of the ball — was certainly in favor, even given the unorthodox timing of the deal. "Is there ever a bad time to announce J.J. continuing as an Oriole?" he beamed during Thursday’s press conference.
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Even with Hardy in tow at a reasonable price, general manager Dan Duquette will have his hands full at keeping his current cast together. The O's have only about $46 million committed for next year, most of it owed to Hardy, Adam Jones and Ubaldo Jimenez, but there are no shortage of places Duquette will need to spend.
Chris Davis, Alejandro De Aza, Tommy Hunter, Brian Matusz, Bud Norris, and Steven Pearce and Matt Wieters will all be in their third year of arbitration eligibility, most due significant raises. Zach Britton, Miguel Gonzalez and Chris Tillman are among those who will be arb-eligible for the first time. The answers to long-vexing questions about how to afford Davis, who suffered through a horrendous year and then was suspended for stimulant use, and Wieters, who underwent Tommy John surgery, may be no more clear than they were six months ago, but they're bound to be less expensive.
Additionally, Nick Markakis has a $17.5 million option that's likely to be declined or reworked into a longer, less expensive deal, and both Wei-Yin Chen and Nick Hundley have smaller club options ($4.75 million and $5 million, respectively) that make them more likely to be picked up. Key additions Nelson Cruz and Andrew Miller will be free agents; Duquette is reportedly working on an extension for Cruz, who is coming off his own PED suspension and hit an AL-high 40 homers this year. He added two more in the Division Series, including a two-run shot in Game 3 off David Price that sealed their sweep of the Tigers.
For the budget-minded Orioles, whose $107.5 million payroll ranked 15th in the majors while setting a franchise record, even a mid-sized deal like Hardy’s carries a risk. Nonetheless, the shortstop has been a critical player at the center of the team’s revival as a competitive entity, and the market for alternatives is bleak, so this contract makes solid sense.
