Financial Crunch
Houston Astros confront tough decisions as revenue takes a hit
Dec 19, 2023, 2:43 pm
Teams are reportedly calling about Framber Valdez and his availability. Composite Getty Image.
So why is a baseball team in America’s fourth-largest city, with the local economy booming, that plays in a clean, comfortable stadium with lots of parking, that charges the 5th-highest prices for tickets, beer and hot dogs, the value of the team has nearly quadrupled, and is riding a dynasty of success on the field … singing the blues over money problems and the general manager was practically wearing a barrel and suspenders at baseball’s winter meetings?
It all comes down to local TV revenue, where the Astros are closer to the small market Brewers and Marlins than they are to the Yankees and Dodgers. Because the Astros had to create a new TV network – Space City Home Network — in partnership with the Houston Rockets due to the demise of AT&T SportsNet SW, the team’s broadcast revenue is expected to drop by tens of millions of dollars. Make that many tens of millions of dollars.
With revenue taking a hit like that, something has to give, and it will be the Astros payroll. That’s why the Astros have all but admitted they will say goodbye to Alex Bregman when his contract expires at the end of the next season, and No. 2 starter Framber Valdez could reportedly be available in a trade.
The Astros payroll currently sits at just above the MLB luxury tax threshold of $273 million, with Kyle Tucker’s big-ticket future with the Astros looming. The Astros have busted the luxury tax paywall only once since Jim Crane bought the Astros in 2011.
According to Forbes, the value of the Astros stands at $2.25 billion, almost four times what Crane paid for the team. Big Macs and homes in West University Place haven’t gone up that much.
We know the numbers by heart: since 2017 the Astros have won six American League West titles, seven ALCS appearances, four World Series appearances, two championships. The Astros drew more than 3 million fans paying premium prices to root, root, root for the home team.
I used to tell my Little League teams, you guys are so lucky to be born when you did. You get to watch an incredibly talented baseball team with great players who do nothing except win the past seven seasons.
There are less fortunate kids who live in cities where the team plays like Bizarro Astros. Imagine if you had to watch the Kansas City Royals or Detroit Tigers those same seven years. Both are riding seven-year streaks of losing records. And their best players get the hell out of Dodge the minute they can.
Yes, the Astros have lost a bundle of top stars in recent years without making a sincere effort to keep them. Carlos Correa, Justin Verlander, Gerrit Cole, George Springer, Charlie Morton and others left Houston for greener – as in money – pastures. But somehow the Astros found new stars to replace them and kept winning.
We still have Jose Altuve, Tucker, Verlander, Valdez, Bregman, Pena, Pressly, McCormick and more. We, the Astros, should be all right for 2024. To infinity and beyond? That’s another question.
One prediction guaranteed to come true next season: if you attend an Astros game and get a hankering for a beer and a dog … check your credit card limit first.
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The Astros welcomed first baseman Christian Walker to the team Monday, in one of two moves that almost certainly marks the end of Alex Bregman’s time in Houston.
Walker signed a $60 million, three-year contract that will pay him $20 million annually just more than a week after the Astros acquired infielder Isaac Paredes from Cubs in the trade that sent outfielder Kyle Tucker to Chicago.
“The way I view it right now is Paredes is going to play third base and Walker is going to play first base,” general manager Dana Brown said Monday. “And Bregman’s still a free agent.”
The Astros had hoped to re-sign Bregman, the team’s third baseman for the last nine seasons, but Brown said the negotiations stalled.
“I thought we made a really competitive offer, showing that we wanted him back,” he said. “But we had to pursue other options. We couldn’t just sit there. We locked in Paredes early in that trade, knowing that he could play third or first and then when the opportunity to add another bat came up we just jumped on it.”
The addition of a first baseman was a priority this offseason for the Astros after they released struggling first baseman José Abreu less than halfway through a $58.5 million, three-year contract.
“We knew we had to get better at first base,” Brown said. “We pursued (Walker) and we’re excited to have him because we know that we’re going to have a really good first baseman that can defend and also hit the ball on the seats from time to time.”
Walked was attracted by the sustained success of the Astros, who won their first two World Series titles in 2017 and '22.
“I’ve been watching this team for a while now, and that edge, the energy, the expectation, you can tell that they’re going out there with a standard,” he said. “And I’m very excited to be a part of it.”
Walker is looking forward playing on an infield with star second baseman Jose Altuve. He’s fascinated by the success and consistency Altuve has had over his 14-year career.
“I get a chance to learn from Jose Altuve,” Walker said. “Nothing really gets better than that.”
Brown was asked what he would tell fans disappointed to see the Astros lose another star after George Springer and Carlos Correa left as free agents in recent years.
“I would just tell the fans that look, we are very focused on remaining competitive,” he said. “We’re very focused on winning division and going back to the World Series, and I think with these additions that we have the ability to do that. So, I feel strongly that we’re going to be picked to win the division first off. And if our pitching holds up, which I feel strongly about, as well, I think we’ll get deep into the postseason.”
The Astros won the AL West for a fourth straight year this season before being swept by the Tigers in an AL Wild Card Series.
Walker, who turns 34 during the opening week of the season, hit .251 with 26 homers, 84 RBIs, 55 walks and 133 strikeouts this year. That was down from 2023, when he batted .258 with 33 homers and 103 RBIs as the Diamondbacks reached the World Series.
Walker played in 130 games this year, down from 157 in 2023 and 160 in 2022. He was sidelined between July 29 and Sept. 3 by a strained left oblique.
He spent the last eight seasons with the Diamondbacks, where he hit 146 homers with 442 RBIs and a .251 batting average.
He didn’t secure a full-time job in the big leagues until 2019. He’s provided consistent power over the past six seasons and has grown into an elite defensive first baseman, winning Gold Gloves in each of the past three seasons.
Walker played college ball at South Carolina and was drafted by the Baltimore Orioles in 2012. He made his big league debut with the Orioles in 2014 but couldn’t stick in the majors and was claimed off waivers by Atlanta, Cincinnati and Arizona in a five-week span.
Walker’s contract has a limited no-trade provision allowing him to block deals to six teams without his consent. He would earn $200,000 for winning an MVP, $175,000 for second, $150,000 for third, $125,000 for fourth and $100,000 for fifth.
Walker also would get $100,000 for World Series MVP, $50,000 for League Championship Series MVP and $75,000 apiece for making the All-Star Game or winning a Gold Glove or Silver Slugger Award.
Infielder Grae Kessinger was designated for assignment to open a roster spot.