With Low Core Payroll Locked In, O’s Can Take on Riskier Deals

If you have ever read any of my thoughts on free agency, you know that I am largely against long term, nine-figure contracts. When (not if), the Orioles under David Rubenstein once again start handing out multi-year deals, I would want to see them more in the three-to-four year range, even if it meant higher annual average values (AAV).

The Orioles are entering a unique situation with their payroll. While fans clamor for Rubenstein to spend money, the bottom line is that the team will remain inexpensive, at least on offense, due to how well everyone is developing.

Barring something unforeseen, whether it be a trade or major injury, Opening Day 2025 will have a lineup that consists of Jackson Holliday, Coby Mayo, Gunnar Henderson, Adley Rutschman, Heston Kjerstad, Jordan Westburg and Colton Cowser.  Samuel Basallo will not be far behind either.

To put that in perspective, of those players, only Rutschman will be starting arbitration. Gunnar and Westburg will not start until 2026. Cowser and Kjerstad won’t start until 2027, which is also the earliest Mayo or Holliday could enter (depending on when they come up in 2024. It’s possible either or both won’t enter until 2028). Basallo will probably be 2028 as well.

For payroll purposes, in 2025 the O’s will be paying this group of players (not including Basallo) $10-12 million total (most of which will go to Rutschman). In 2026, they will be paying this group somewhere in the $25-30M range. 2027 is more up in the air without knowing about Mayo and Holliday. Let’s assume they accrue enough time this year to become arbitration-eligible in 2027. That year will see this group, all of which will be in arbitration at that point (except Basallo), cost something in the $60-70 million range, give or take.

Let’s put that in perspective. If you buy into the theory of WAR and how much each win is worth, Gunnar has been worth about 50 million dollars so far this season. That’s just one guy.

This is all to say that the O’s are going to be getting a ton of surplus value out of this group for several years to come. Now of course, someone(s) may get traded or injured, or guys could stop developing. Even if they extend these guys to longer-term deals, their contracts will not start getting into the larger, payroll-changing numbers for another three or four year years. And that is just part of the group. The others will come later.

I have yet to mention that Grayson Rodriguez isn’t arbitration eligible until 2026. Additionally, Kyle Bradish, while eligible for arbitration in 2025, won’t make much at all next year, and that will impact his cost in 2026 and 2027. All of those numbers will be lower than they would have been had he remained healthy. Even Felix Bautista is only getting $1M in 2025 and will still have two years of control after that. Again, the injury will suppress his totals.

When you factor in those three guys, that is your current core group you are looking at long term. Eleven total players. For the next three seasons, the most that group of 11 will cost is probably about $100M, which will be in 2027.  Again, I’m going up until 2027 because we don’t know what will happen to Adley, Bradish and Felix but let’s say they are all gone after 2027. The Birds still have Gunnar, GRod and Westburg for one year, Basallo for three, and Mayo, Kjerstad, Cowser and Holliday for two. Even if we extend it out to 2028, that group will only be getting ~$110M, with the guys in their final year of arbitration accounting for most of that.

Now, this is obviously a very rosy outlook that assumes all guys develop, stay healthy, are not traded, etc…

It’s not likely that will all happen, but it is possible. The take-home point is that payroll will be kept low for quite a while. Of course, there is more to fill in on the roster, but it just isn’t wise to spend a lot of money on the bullpen, bench, or even back-end rotation. All constitute a poor use of resources, and aren’t necessary if a team is drafting and developing well.

Two other factors that I’ve yet to discuss:

1. The O’s group of international talent could crash some of this party; and
2. We also don’t know what future draft hauls will produce.

Ok, I’ve shown that the team will remain inexpensive for a while. What’s the point?

Well, it comes back to what I opened with. Does this payroll allow the O’s to go big with a free agent or two and/or allow them to take on a contract (or someone that will make good money soon) at the deadline?

The player most likely popping into most fans’ minds is Corbin Burnes. I generally against going beyond five years for a pitcher. But, could the Birds do just that to get a guy like this signed, even if he has shown some chinks in the armor this year (while still being a Cy Young contender and possible All-Star Game starter)?

Maybe it’s not Burnes specifically, but does the fact that he has so many young stars on rookie deals – who are making, basically, no money – cause Mike Elias to change usual mode of operation and pursue bigger name free agents? Does he go past the 3-4 years that his former teams, the Cardinals and Astros, do not usually offer free agents?

The current structure of the Orioles may allow for that. While those deals are risky, if the new ownership signs off, this allows Elias more flexibility in the trade and free agent market. And that flexibility exists because of drafting properly, developing well, and making some smart trades.

I don’t expect Elias to deviate from his core beliefs on team building, but he may become more amendable to certain things.

Circumstances change. This current situation has put the O’s in an enviable position to take on risks that they normally wouldn’t.