Re-signing Hisashi Iwakuma: Risk or Reward?

Whether you agree with the decision or not, Hisashi Iwakuma is still a Seattle Mariner after a number of suitors came calling for his services prior to the trade deadline. An August trade isn’t off the table yet but it seems unlikely the Mariners will deal the free-agent-to-be. This may be especially true considering it was ownership who was blocking a pre-trade deadline deal in the first place:

Sources: Despite well-under-.500 record, Mariners do not plan on trading Hisashi Iwakuma. Seattle telling teams ownership wants to keep him.

— Jeff Passan (@JeffPassan) July 30, 2015

Two days after the trade deadline, Nick Cafardo of the Boston Globe noted that the Mariners were hoping to sign Iwakuma for another season or two.

Iwakuma has suffered through his fair share of grief during this disappointing season. He was ineffective early this season, then injured, then ineffective again, and has only recently strung together a few good starts. Despite his elevated ERA and FIP, his strikeout rate and walk rate are both well within his established career norms. Much of his struggles this year have stemmed from an elevated home run rate. His xFIP is a much nicer 3.24 but Iwakuma has never posted a home run rate near league average. If he had allowed home runs at his career rate this year, his FIP would be around 3.60 right now, not 4.43.

I’m not convinced Iwakuma is toast yet but there’s little confidence that he can be penciled in for 180-200 innings a season anymore. During the offseason, I examined the performance of other 33-year-old pitchers heading into their age-34 season, with an Iwakuma extension as the context. Here’s the relevant graph from that article:

Iwakuma’s line has flattened out in his age-34 season—though he should have around ten more appearances to push his fWAR total a bit higher. The average fWAR for this sample in their age-35 season was 1.39.

Barring another late season collapse, we can probably assume that Hisashi Iwakuma will probably be a Seattle Mariner next year. If the Mariners ownership group was so adamant the team keep him for the rest of his walk year, they must be confident they’ll be able to re-sign him this offseason. They could also surprise us and announce an extension before the offseason but that’s probably unlikely.

A complicating factor is the Qualifying Offer. There has been some conflicting information about whether or not Iwakuma is eligible for an offer; by straight service time he wouldn’t be, but there may be a provision in his contract that would make him an Article XX(B) free agent at the conclusion of his contract, and therefore eligible for a Qualifying Offer. Assuming he is eligible, the Mariners may slap one on him to protect themselves if he does suddenly decide to leave Seattle. Doing so risks Iwakuma actually accepting the Qualifying Offer which is expected be worth around $15.8 million.

There are two players who could serve as interesting guides for the Mariners when negotiating a new contract with Iwakuma—one is on that graph above and another is a fellow countryman. As they reached their mid-30s, Andy Pettitte and Hiroki Kuroda negotiated a series of one-year deals until they retired. Here are the relevant data:

	Andy Pettitte		Hiroki Kuroda
Age	Contract	fWAR	Salary	fWAR
34	3 yr/31.5M (17.5M)	3.4	3 yr/35.3M (10M)	2.3
35	1 yr/16M	4.0	3 yr/35.3M (13M)	4.3
36	1 yr/16M	3.7	1 yr/12M	2.7
37	1 yr/5.5M + 6.5M in bonuses	3.4	1 yr/10M	3.8
38	1 yr/11.75M	2.4	1 yr/15M	3.7
39			1 yr/16M	3.3
40	1 yr/2.5M (minor league)	1.6
41	1 yr/12M	3.1

(Salary data from Cot’s Baseball Contracts [Pettitte, Kuroda])

Andy Pettitte had a much longer history of success when he signed with the Yankees in 2007 on a one-year contract worth $16 million. Pettitte would sign a series of one-year deals until his retirement in 2010. Even when he came back in 2012, the trend continued until his last contract when he was 41-years-old. The average annual value of his five major league deals (excluding his minor league deal in 2012) was $13.55 million. That’s probably a bit high for someone like Iwakuma who has a long injury history and doesn’t have the same pedigree as Pettitte.

When he came over from Japan, Hiroki Kuroda signed a three-year contract with the Dodgers as a 33-year-old. At the conclusion of that deal, he signed a one-year deal with Los Angeles with a sizable signing bonus. As a 37-year-old free agent, he would sign a series of one-year agreements with the Yankees until he returned to Japan this past offseason. New York actually offered Kuroda a Qualifying Offer in 2013 but then re-signed him anyway after he declined the offer. Kuroda also had some injury history and his peripherals were fairly similar to Iwakuma’s. The average annual value of his four one-year deals was $13.25 million. His earlier one-year deals would be more suitable for someone like Iwakuma (AAV $11M), rather than the two final deals he signed with the Yankees.

If the Mariners do intend to re-sign Iwakuma, a one- or two-year deal would probably be the best place to start. If they’re planning on making him a Qualifying Offer, they’d probably be better off negotiating a two-year deal to mitigate the risk of him accepting the offer. Until he can prove that he’s able to stay on the field, they’re probably better off signing him to a series of one-year deals heavy on performance bonuses. They’ll probably have to offer a higher annual value if they want to stick with just a one-year pact, but that’s a small price to pay for the flexibility of a short-term commitment to a volatile asset.

What do you think? What's the right price for a pitcher like Hisashi Iwakuma?