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San Diego Padres took out massive loan to cover payroll, impact on Juan Soto and others

The San Diego Padres are coming off a down 2023 season in which they won 82 games and missed out on the playoffs altogether.

This came after an appearance in the NLCS the previous season. It also came with San Diego boasting the third-largest payroll in baseball at $256.1 million, per Spotrac.

Apparently, meeting said payroll was an issue for owner Peter Seidler and Co. According to a report from Evan Drellich, Dennis Lin and Ken Rosenthal of The Athletic, San Diego had to take out a $50 million loan from MLB to meet the payroll demands. The report also indicates that the Padres had initially asked for $100 million.

“Despite selling more tickets this season than all but one Major League Baseball team, the San Diego Padres took out a loan for about $50 million in September to address short-term cash flow issues and meet their obligations, including player payroll.”

Report on the San Diego Padres’ payroll issues

Xander Bogaerts ($25.5 million), Juan Soto ($23 million), Manny Machado ($17.1 million) and Blake Snell ($16 million) were the highest-paid Padres players this past season.

The report comes amid indications that the Padres are looking to cut their payroll in a massive way during the winter.

“In part because they are out of compliance with MLB regulations regarding their debt service ratio, according to multiple sources, the plan is to go into 2024 with player commitments of around $200 million,” report from back in September.

Related: San Francisco Giants, San Diego Padres headed in different directions after Bob Melvin move

San Diego Padres mass exodus, including Juan Soto

san diego padres payroll, juan soto
Kamil Krzaczynski-USA TODAY Sports

Likely National League Cy Young winner Blake Snell is joining star closer Josh Harder on the MLB free agent market this winter. Based on these reports, it seems highly unlikely that San Diego will be able to retain either one in a market that’s going to show a ton of interest from teams in larger markets.

The more-pressing concern is the future of star outfielder Juan Soto in Southern California. Indications are that the Padres will look to move the Scott Boras client this winter before he hits a contract year. Like pretty much every Boras client, Soto is unlikely to agree to an extension before testing the free-agent waters.

San Diego already let manager Bob Melvin walk to the division-rival San Francisco Giants due to perceived issues with GM and president A.J. Preller. That could just be the first domino to fall.

It must be noted that MLB teams typically tap into lines of credit from the league. However, sources that were not able to speak publicly in The Athletic report detailed the Padres’ financial situation as “worrisome.”

It’s certainly something to keep an eye on moving forward into the MLB offseason. Remember, the Padres have big-money contracts tied up to Manny Machado (11 years, $350 million) and Fernando Tatis Jr. (14 years, $340 million). Those could also end up becoming major issues for the organization down the line.

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