Baseball’s record-setting free agency spending spree, in charts

Major League Baseball deal-making came to a screeching halt at midnight on Thursday when the league’s collective bargaining agreement expired, causing a lockout. But that didn’t stop a record-setting amount of cash that was doled out in the free agency market in the days before.

“It’s a unique situation,” said Patrick Rishe, director of the sports business program at Washington University, explaining that the impending lockout and uncertainty around the details of the next CBA pushed teams and players to act more quickly than in a typical offseason.

 “People might think that we should have a lockout every year because it certainly made the free agency situation exciting for a few days.”

Pitcher Max Scherzer made headlines, and baseball history, by signing a three-year, $130 million deal with the New York Mets. At $43.3 million per year, that makes Scherzer the highest-paid MLB player ever by average annual contract value, according to Cot’s Contracts, a product of Baseball Prospectus.

The record-setting figure raised some eyebrows because Scherzer, an eight-time All Star throughout 14 seasons in the majors, is 37 years old and likely nearing the end of his career.

Rishe said the deal may have been as much about Mets owner Steve Cohen’s desire to “make a splash” in New York as it was about turning around the team’s 77-85 record last season.

Cohen opened Scherzer’s introductory press conference last week focused on how his new starting pitcher would improve the Mets’ World Series odds. He did acknowledge, though, that off-the-field factors played into the calculus of the deal, saying “I might add a little bit more for brand building” on top of the value of Scherzer’s skills when asked how he arrived at the $130 million number.

Scherzer, who is a representative with the league’s union, said that his historic deal would serve as a benchmark and that “other players are going to be able to use that number in the future” to help with their own contract negotiations. 

The $130 million deal isn’t the most lucrative by total value, according to a list maintained by Cot’s Contracts. That title goes to Los Angeles Angels outfielder Mike Trout, whose 12-year, $426.5 million contract runs through 2030.

The Mets’ total payroll for 2022 is now $255.5 million, the most of any MLB team among projected Opening Day 26-man rosters.

The CBA expiration deadline triggered a flurry of deals, and teams committed to a single-day record of $1.4 billion in player salaries on Dec. 1, according to a tally from the Associated Press. 

Along with Scherzer, five other players were inked to contracts of $100 million or more: shortstop Corey Seager and infielder Marcus Semien with the Texas Rangers, infielder Javier Báez with the Detroit Tigers, pitcher Kevin Gausman with the Toronto Blue Jays, and outfielder Byron Buxton with the Minnesota Twins.

In addition to locking in money and contract terms, Rishe said that signing deals now instead of whenever the new CBA is finalized — which could be weeks or months — allows players to know where they will be spending the upcoming season and start making logistical arrangements. 

Six players have been signed to free-agency deals of $100 million or more as of the lockout, more than any season other than 2016, a Cot’s Contracts count dating back to 2010 shows.

With a handful of big names still on the market this year, 2016’s record of seven $100 million dollar deals could be surpassed once the lockout ends. Players Carlos Correa, Freddie Freeman, Kris Bryant, and Trevor Story, among others, went into the lockout unsigned. 

“It would not surprise me if all four of the players you mentioned also sign $100 million deals, assuming we have a full season in 2022,” wrote Baseball Prospectus author and financial data curator Jeff Euston in an email to CNBC when asked about Correa, Freeman, Bryant, and Story’s free agency prospects. 

Byron Buxton’s contract with the Twins is not counted by Cot’s Contracts as a free agency deal because Minnesota signed him a year before he was due to hit the open market, meaning that he did not have the advantage of fielding offers from the other 29 clubs. But in addition to Seager, Semien, Baez, Scherzer, and Gausman’s agreements, reigning American League Cy Young Award winner Robbie Ray signed a $115 million deal with the Seattle Mariners.

This trend toward larger contracts underscores one of the issues on the table during CBA talks. Average player salaries are falling, according to an Associated Press report, which Rishe says is because middle-tier players have seen payouts decline even as the massive salaries for star players grab headlines.

The MLB Player’s Association wants to make it easier for players to enter free agency sooner and seek more money. The union also wants to increase minimum salaries, which stand at $570,500.

This year’s spending spree may undercut owners’ positions at the bargaining table, Rishe said. “They can’t cry poverty if they’re spending this kind of cash.”

–CNBC’s Jabari Young contributed reporting.