One of the main talking points of the Nolan Arenado sweepstakes is his opt-out clause.
But there seems to be a misconception about what the opt-out could mean in a trade.
Arenado signed an eight-year, $260 million deal with the Rockies last February. Seven years and $234 million remain.
Here is the structure:
Arenado can opt out of the contract after 2021. If he does, it means another team would be acquiring him for just two seasons — a much, much different proposition than seven.
Many of the Arenado opinions this offseason have been that, because of the opt-out risk, it's not worth trading away the young players the Rockies would require.
But put yourself in the Rockies' shoes. Wouldn't the best course of action be to evaluate the best offer(s) and then involve Arenado and his representatives in the conversation to see if he's willing to renegotiate the opt-out? It serves the Rockies' best interest to give the other team what it wants.
And it could serve Arenado's interests, too. Let's say the Cardinals really, really want Arenado but are willing to trade away the prospect package the Rockies covet only if Arenado is willing to delay the opt-out until after 2023. That would give St. Louis four full years of Arenado, double the current guarantee.
They'd have to make it worth Arenado's while. They'd have to add something like $5 million per year to those four years. Arenado would get $20 million more in exchange for pushing back the opt-out two years.
Does that math make sense for him?
Arenado is four months away from his 29th birthday. The 2022 season, the first after his opt-out, would be his age-32 season.
From 2022-26, the final five years after the opt-out, Arenado is currently scheduled to make $164 million. Now let's add in the extra $20 million mentioned above, the return gift for Arenado theoretically delaying his opt-out. Now we're at a total of $184 million.
For it to be worthwhile to opt out, Arenado would need to think he'd get more than five years and $184 million. And he'd be ahead of his age-32 season. As great as he is, that is ambitious. That's a five-year guarantee of nearly $40 million to a player in his ages 32-36 seasons.
And for the Rockies? This would be ideal. Because two years of Arenado isn't enough for an acquiring team, whereas seven years and $234 million might be too much. Four years could be just right. A team would have to trade a helluva lot more for four years of Arenado than for two.
What about the Phillies?
The Cardinals and Rangers have been directly linked to Arenado more than any other teams. There's been nothing about the Phillies, who act in secrecy with these things.
Could the Phillies even put together a competitive package for Arenado? It would have to involve Spencer Howard because the Rockies need pitching, and Alec Bohm would make sense too as a replacement third baseman. Colorado might also need a plug-and-play young guy like Scott Kingery. Sounds like a ton to give up. Remember, it's Nolan Arenado.
Arenado's salaries would push the Phillies' payroll much higher than the Phils want it to be. Adding Arenado's AAV would push their payroll in 2020 to around $237 million. That would prompt a luxury tax payment of approximately $5.8 million, in addition to the other penalties for exceeding the $208 million threshold.
If the Phillies were to include Kingery and Vince Velasquez in the deal, that would get them back down to about $229 million.
Would it be worth it for the Phils? Depends on what you value more: the possibility of winning it all at some point over the next five years, or the possibility of sustaining success longer than that by holding onto your top young pieces.
The Phillies do need some of these top prospects to graduate to the majors and make the impact they're supposed to make. They need an infusion of inexpensive, productive youth because of how many giant salaries are already on the payroll.
It's a fun philosophical question of team-building that makes this typically quiet mid-January period more exciting.