Estimating the Value of Contract Extensions: Nicholas Castellanos

In this investigation, we will attempt to approximate the salary (dependent on the length of the deal) the Tigers will offer impending free agent Nick Castellanos (in their efforts to extend him) through encompassing age decline and the average cost / 1 WAR on the FA market.

In Neil Weinberg’s Beginner’s Guide To Aging Curves, he explains that…

“a basic rule of thumb is that once a player gets to 30, you sort of expect them to lose about 0.5 WAR per year of value due to aging. Some players will age better or worse, but that’s an average estimate”.

Another one of his articles analyzed the price teams pay per 1 WAR on the FA market. Neil Weinberg asserts that…

$/WAR is basically a measurement of how much teams are paying for players on the free agent market according to how many wins they will add over replacement level players. Right now, we think teams are paying about $8 million per every WAR they add to their roster. For example, a 2 WAR player signed for three years would theoretically provide his team with 6 WAR, so a team might want to pay him anything up to $48 million. If the team pays less than $8 million for each expected WAR, we call this a “good deal” and if they pay more, we say they “overpaid.”

Castellanos will presumably insist on pay comparable (relatively speaking) to what he could have potentially gotten had he tested the FA market. 

DETROIT, MI – JULY 28: Nicholas Castellanos #9 of the Detroit Tigers celebrates after hitting a three-run home run against the Houston Astros during the second inning at Comerica Park on July 28, 2017 in Detroit, Michigan. (Photo by Duane Burleson/Getty Images)

27-year-old slugger Nick Castellanos is due to hit free agency after this season (2019). He had a career year in 2018 in terms of AVG (.298), OBP (.354), and fWAR (3.0). Castellanos has hit at least 20 HRs and driven in more than 80 RBIs in each of his last two seasons, solidifying himself as an intimidating middle of the order bat. Castellanos’ transition from 3B to RF didn’t go as smoothly as the Tigers would’ve liked. Ironically, Nick graded out worse in RF (-19 DRS per FanGraphs) than at 3B (-14 DRS in 2017).

From the sounds of it, the Tigers haven’t made much of an effort to extend Castellanos; however, there are many reasons why an extension makes a ton of sense for both sides involved…

  • The market for players who genuinely hurt their team defensively is limited, but that could change in the years to come, with talks of the NL adopting the DH seeming more and more likely
  • Few teams have reached out to the Tigers about acquiring Castellanos (they presumably don’t value him very high — low likelihood they’d meet his asking price were he a FA)
  • Castellanos could continue to work on his game defensively with the Tigers, who have nothing to lose (this could allow him to potentially improve defensively, thus improving his value = more money)
  • Castellanos could mentor the youngsters and could see the team develop and grow before his eyes
  • The Tigers are planning to expand the payroll in 2020 (Castellanos would still be on team then)
  • Castellanos is a fan favorite who plays the game with a passion — exactly what fans want to see

For the purpose of this investigation, let’s assume Castellanos loses 0.5 WAR annually starting in 2022 (his age 30 season) and that the cost per 1 WAR is ~$8 million…

2020 (age 28 season): 2.1 WAR [FanGraphs’ Depth Charts projection for 2018]; $16.8 million

2021: 2.1 WAR; $16.8 million

2022 (age 30 season): 1.6 WAR; $12.8 million

2023: 1.1 WAR; $8.8 million

2024 (age 32 season): 0.6 WAR; $4.8 million

Castellanos contract possibilities:

  • 1 yr, $16.8 million
  • 2 yr, $33.8 million
  • 3 yr, $46.6 million
  • 4 yr, $55.4 million
  • 5 yr, $60.2 million

Prediction: 3 yr, $46.6 million

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