In parts 1 and 2, we covered just what a prize of a signing Luis Robert would be, and how financially, the Padres are perfectly positioned to close the deal with Robert. With a generous financial cushion, the only thing left is to show that the Padres strategically MUST sign Robert as a part of their rebuilding plan.
This is the counterpoint, but it’s also dangerous:
I think this will be a common defense if the Padres fail at signing Luis Robert (and it would truly be a failure). It’s the kind of reasoning that will lead to a failure of this rebuild. The window is closing for the Padres being able to exploit the rules to gain a competitive advantage. Starting next month, the rules are changed. If anything, the Padres are behind the 8 ball for the next two years due to the upcoming penalty period preventing them from signing top international prospects. The need to sign Robert doesn’t mean the rest of the 2016/2017 international signings were inadequate or faulty in any way, but failing to sign Robert reflects an abject failure to capitalize on the overarching rebuild strategy laid out by Preller. While what’s been done is great, investing in prospects is still a number game, and a one time massive infusion of talent needs to be continually augmented anyway possible. This is doubly so when we are talking about a player with the star potential of Luis Robert. This is triply so when the Padres are flush with cash with very few ways to productively spend it in the next two years.
If the Padres were close to competing, they could potentially use their 2018 profit windfall to dip into the free agent market. There are two problems with this approach though. First, the Padres are terrible this year and nowhere near competing. Second, the 2017 free agent class totally sucks. Here are the top free agents:
Jake Arrieta, Yu Darvish, Johnny Cueto (opt out available), Masahiro Tanaka (opt out available), Jonathan Lucroy, J.D. Martinez, Justin Upton (opt out available), Eric Hosmer, Mike Moustakas
It really sets your heart aflutter, right? With nothing productive to spend the $79M of 2018 windfall profits on the free agent market, the Padres need to look elsewhere. Well, what about other international players? The Padres are hard capped at roughly $6M, and due to international penalties, can only sign players up to $300k of bonuses. Even with the Mexican Loophole, that would realistically only boost the $6M up to about $8M if they maximized the strategy.
So, given that there is little to productively spend the money on, what is a fair price for Luis Robert? The easy answer is what the market will bear (cop out), but the notion of “overpaying” to win the bidding hurts a lot less when there are few if any other productive uses for the money. It’ll either be spent [productively] or just become retained earnings or earning distributions. Cash on it’s own isn’t productive, and it makes investing sense to get the Padres’ cash into an asset that may appreciate (possibly appreciate a lot in Robert’s case). In today’s local real estate market, you see houses bid up to levels where you assume it must be “overpaying”, but it’s just investors being willing to “overpay” to park their cash into productive assets. It’s not overpaying if it’s put to productive and presumably profitable use. Luis Robert is that 4 BR 3 bath house on a view lot in Carmel Valley with good schools nearby.
The final point is that the Padres are asking a lot of fans with the full rebuild. They are asking them to buy into a long term plan with a non-insignificant risk of failure, to put up with dreadful Major League Baseball for three years, to charge Major League prices for a tanking product, and to trust in the strategy. And I believe most fans have put their trust in AJ and into the rebuilding strategy. But the faith that fans and customers put into the strategy is based on the idea that the Padres are going all-in on the stated strategy to build from within with international players and draftees. Resting on their laurels and failing to acquire arguably the best player in this year’s J2 signing period is not the right statement to make to fans that are being asked to be patient and have faith. AJ Preller no-showing to the private workout for Luis Robert at the Padres’ Dominican facility is not good optics for fans that want to know that the team is doing everything it possibly can to execute The Plan. Ron Fowler complaining about money spent on 1090 is not good optics when the team is facing several years of windfall profits (ESPECIALLY if they don’t allocate the funds needed to sign Robert). In all likelihood, if the Padres don’t sign Luis Robert, you’ll read a post written by employee of the league AJ Cassavell saying “they just didn’t like the value they were seeing in Robert”. But the truth of the matter will be more along the lines of what Dennis Lin wrote:
Sources indicate that the Padres, having already committed $80 million, may be approaching their limit
As we’ve shown in this blog series, the talent is there, the potential is there, the money is there in quantity. The Padres owe their fans that are standing by patiently for years the knowledge that they are doing everything within their power to capitalize on opportunities and to fully utilize revenues to the fullest to build a championship team.
In the end, the Padres rebuild strategy is a good one and the right one. But they are being handed one last ace in the hole, possibly the best one player they’ll sign this J2 period. While they’ve done great so far with the rebuild, and a failure to sign Luis Robert doesn’t diminish what they’ve already done, failing to pony up the money needed to win the bidding for Robert would be an abject failure in process. It is doing a cross country drive from Washington DC to San Diego and deciding to just stop the car in Tucson and get an apartment. Sure you made it 85% of the way there, but now you’re stuck in Tucson. Don’t stop in Tucson.
No one should stop in Tuscon. That statement transcends the metaphor.
Pingback: This Week in Padres Twitter – 5/19/17 | Gwynntelligence·