It’s often said the Yankees get whatever player they want in free agency. This offseason, they’ll be tested as to how badly they want one of their own.
Contract talks between the Yankees and their captain, Derek Jeter, may not go as smoothly as one would hope. After all, there are two sides to Jeter: the veteran in the twilight of his career, and the shortstop who is a sentimental fan favorite and the face of the team — and one of the most beloved athletes in New York sports history.
“You have to sign him and you almost certainly will grossly overpay,” said an AL West team executive, who requested anonymity out of respect for the negotiations.
While Jeter, 36, reportedly desires a long-term deal for anywhere between four and six years, questions about his future on-field production at shortstop (including a career-low .270 average in 2010) make a quick agreement unlikely. Recent reports said the Yankees will open with a three-year offer in the $45 million to $60 million range; negotiations with Jeter and his agent, Casey Close, could drag well past Thanksgiving.
“It’s not as cut-and-dried as a lot of people think it’s going to be,” said Wayne McDonnell, a sports management professor at NYU.
To overpay or not
After concluding a 10-year, $189 million deal, the Yankee captain is expected to command at least $15 million annually. But the Yankees don’t want to be saddled with a long-term contract similar to that of Alex Rodriguez, who is owed $174 million in base compensation through 2017, when he will turn 43.
“Everyone thinks the Yankees have infinite money, but it’s still a business,” said Keith Law, an MLB analyst for ESPN who was previously a front office executive for the Toronto Blue Jays. “They’re going to act in their best economic interest.”
Some experts suspect that means not only rewarding Jeter for what he’s done, but what he might do. For example, it’s appropriate to compensate Jeter for reaching 3,000 hits, said McDonnell. (Jeter has 2,926.)
“He should be treated the same way as A-Rod with his clause,” McDonnell said, referring to the marketing agreement that could pay Rodriguez $30 million for five home run milestones. “Jeter should receive $6 million for achieving 3,000 hits.”
Despite winning his fifth Gold Glove this month, Jeter is viewed by many analysts as a poor defensive shortstop. Whether the 11-time All-Star will be receptive to a position change is unclear.
“The answer to that question will help dictate the length of the contract,” said an AL East team executive who did not wish to comment publicly on another club’s deliberations.
Structuring the deal
Robert Boland, a sports economic professor at NYU, said a two-part deal makes sense.
“It may be better to pay him more for two years,” Boland said, “and do the legacy deal two years from now.”
Emphasizing that aging athletes can break down unexpectedly, Law said it would also be prudent to offer a higher annual salary in order to keep a third year off the table. “You always want short-duration deals with older players, no matter how good they are,” Law said.
McDonnell said he viewed three or four years at $15 million to $21 million per year as likely, adding that Jeter’s contract will take until at least the Winter Meetings in early December to complete.
In a long-term deal scenario envisioned by Boland, Jeter would accept a salary below his demands in order to take a percentage stake in the Yankees, valued at $1.6 billion by Forbes in April. The club could then buy back the percentage Jeter owned at the end of the contract, Boland said.
No matter the particular elements, experts agreed that Jeter and the Yankees will reach an agreement. Both sides have too much invested in the other to let a deal fall through.