The Shortsightedness of Passing on Juan Soto
Juan Soto has baseball’s biggest contract, three outfielders (including Soto) have new teams, and Cody Bellinger is still a Cub. Free agents, front offices, and fans alike are grateful that his early decision removes the stagnation from this year’s shopping season. Baseball’s newest salary king got $765 million over 15 years from the Mets, which is almost as much as Tom Ricketts paid for the Cubs 15 years ago. Tell me baseball doesn’t have a Bootleggars and Baptist economy, much to the chagrin of Jerry Reinsdorf, who remains emotionally tethered to those heady years of baseball’s reserve clause.
As for Bellinger, the Cubs lost three potential suitors when the Orioles, Dodgers, and Giants signed Tyler O’Neill, Michael Conforto, and Willy Adames, respectively. San Francisco reportedly wanted to lower payroll but gave Adames $182 million on a seven-year deal. I’m now 2-for-4 with my free-agent predictions while I wait for the Mets to sign Corbin Burnes sometime this week. That may not happen, but keep your eye on the Giants, who appear to be amenable to giving Buster Posey anything he wants. I still think the Mets will sign Burnes, however.
Frankly, I’m surprised Ricketts isn’t willing to sign the higher-priced stars because brand awareness is a key factor in franchise valuations. Bellinger, Dansby Swanson, and Nico Hoerner are not names that drive revenues and increase demand. The Cubs were never considered options for Soto or Shohei Ohtani, once-in-a-lifetime players who challenge GAAP standards but change assessment paradigms. That comes with the territory of running a major market franchise like its competitive balance peers.
An argument could be made that a team might command a higher valuation due to the presence of marquee players on its roster, something Evan wrote about last year. This would likely be reflected through increased team revenue from gate receipts, merchandising, marketing, and local media revenue (via Marquee subscriptions). The Cubs were sixth in home attendance in 2024 and fifth in the National League. Chicago’s attendance is down nearly 10% (300,000 seats) from Wigley Field’s high-water mark in 2016. The average ticket price for a game at the Friendly Confines has also been down about 10% since 2019.
Simply put, signing a generational player like Soto or Ohtani is worth an additional $16-18 million in gate receipts alone, not counting additional postseason ticket sales. Making it to the World Series could be worth an extra $20-25 million. However, Hoyer prefers shorter-term, high-AAV deals and won’t make a 15-year commitment to any player. That immediately eliminated Soto from consideration. It’s also why Swanson and Bellinger will earn more in 2025 than Trea Turner, Bryce Harper, and Freddie Freeman.
“All we’re hearing out of Chicago, the North Side, is ‘eh we’re not gonna be involved in any of the big free agents,’” MLB insider Ken Rosenthal said last week. “[They’re] gonna just try to do some other things. They’re trying to trade Bellinger, I get that. But where are the Cubs? …. [The Cubs] have the ability, if they spend some money, to become a special team…The Cubs have an opportunity here to seize control of this division, and they are squandering it.”
The other issue is that Soto wanted to meet with each team’s ownership group and made it mandatory before starting any negotiations. Ricketts does not prefer to operate in that manner.
“I honestly feel like if you get too involved, you’re probably not adding much value,” Ricketts said. “And also, if you’re making the personnel decisions and the team doesn’t do well, what happens next? There’s no accountability. I’ve always stayed out of the player decisions. Not only are [front office personnel] better equipped to make those decisions, it’s their reputation. It’s their careers. They want to be responsible and accountable.”
Additionally, Ricketts isn’t a trophy owner like Steve Cohen (Mets) or Mark Walter (Dodgers). He’s said several times that owning a baseball team “doesn’t fit into a portfolio nicely.” Short-term payoffs are atypical, and there isn’t a lot of cash flow. Championships are, therefore, a fortuitous byproduct of intelligent spending rather than something worth breaking the bank for. Big game hunting is seen as excessive and superfluous. Chicago no longer seeks to exploit market inefficiencies on the personnel side unless that also adds to its bottom line.
That may hurt Hoyer in his search for mid-tier free agents. It’s also worth wondering what will happen if any of the team’s prospects become superstars. Rōki Sasaki would make a great addition to Chicago’s rotation, but the incentive of competing for championships is not guaranteed. Additionally, attracting mid-tier free agents on short contracts means also outbidding other teams. Is the roster management model genuinely efficient if Walker Buehler essentially taxes the Cubs 20-25% to sign with them?
The Cubs — as a business — are a long-term investment, and Pete Ricketts has said his family “intends to own the team for 100 years or more.” That tells you more about the family than anything. The team was purchased 15 years ago for $845 million and is worth $4.225 billion as of last April. That 500% ROI is rarely seen in a typical portfolio.
That said, Soto doesn’t guarantee a championship any more than Pete Crow-Armstrong or Matt Shaw does. There’s more than one way to skin a cat, right? Hoyer believes he can thread the needle of winning championships while maximizing value. He’ll have to do a better job of that after consecutive 83-win seasons and zero playoff appearances since 2020. Soto and the eight wins he was worth in 2024 would have helped immensely.