The Cincinnati Reds signed Nick Castellanos to a four-year deal on Monday. In an unusual structuring of his contract, Castellanos can opt out after 2020.
Nick Castellanos signed a four-year/$64M deal with the Cincinnati Reds on Monday. While the contract doesn’t expire until 2023, Castellanos has two opt-out clauses included in the deal. Surprisingly, he can opt out after the 2020 and ’21 seasons. While the idea of an opt-out clause on the front end of a contact seems odd, it’s no reason to worry.
According to Mark Sheldon of MLB.com, Castellanos will earn $16M in 2020, $14M in ’21, $16M in ’22 and $16M in ’23. The option for ’24 has a $2M buyout. There’s nothing wrong with those figures, as most folks figured that Castellanos would garner a contract similar to Mike Moustakas. The strange part is Castellanos’ ability to opt out after the 2020 and ’21 seasons.
Now, opt-out clauses are nothing new in baseball contracts. This past year, we saw Stephen Strasburg opt out of his contract, only to sign a new multi-year deal with the Washington Nationals. We could see the same thing from Castellanos next offseason. But maybe not.
Look, we just go done watching Castellanos and Marcell Ozuna finally cash in this offseason after lingering on the market for what seemed like forever. Ozuna bet on himself and resorted to signing a one-year deal with the Atlanta Braves. Another power-hitting outfielder, Yasiel Puig, is still unsigned this offseason.
Next winter, Mookie Betts will be the best free agent outfielder on the market. George Springer could also be available and so will Joc Pederson and Michael Brantley. You could make the argument that all four of those outfielders are better than Castellanos.
So, after a winter in which he was the best available outfielder on the free agent market, Castellanos, if he opts out following the 2020 season, could enter next offseason as the third or fourth best outfielder. It may not be the most prudent move on the part of the 27-year-old.
However, there exists a scenario in which opting out following the upcoming season makes a great deal of sense for Castellanos. Essentially, that would be if he outperforms his contract. In other words, if Castellanos has a monster season and helps lead the Cincinnati Reds to a division title, it makes sense that he’d want to opt out of the contract.
It’s a win-win for both the Reds and Nick Castellanos. Furthermore, if Castellanos does opt out after the 2020 season, the Reds could extend a qualifying offer and at least reap the benefits of a compensatory draft pick if the slugger signs elsewhere.