The Giants and Pablo Sandoval agreed to a $17.15M, plus incentives, contract over Sandoval's arbitration seasons. Sandoval was projected to earn around $3.2M in his first year of arbitration, according to MLBTradeRumors. The common rule for arbitration value is the 40/60/80 rule, where a player generally gets 40% of his market value his first arbitration year, 60% his second, and 80% his third. By this standard and the MLBTR projections, Sandoval would have earned a total of $14.4M over the three seasons, so the Giants seem to have overpaid a bit, respective to the system.
However, not quite $6M a year for a player like Sandoval is quite the team-friendly deal. First, he is only 25 years old, so his peak years are ahead of him, even if his body type may bring them about earlier than normal. Offensively, his .307/.356/.501 career slash line, good for a 125 wRC+, is a good projection for his coming seasons. His defense rated really well last year, but I consider him average to slightly above average at 3B over the long run. He's been fairly durable, aside from his hand injury last year. Overall, I'd call him a 4-5 WAR player the next 3 seasons.
There are a couple possible pitfalls for Sandoval. The elephant in the room is his weight. He lost 30 or so pounds by the beginning of last season, and by the end of the summer, most of it looked to be regained. He is unlikely to keep up defensively at 3B at such a weight and eventually could be more prone to general wear-and-tear injuries. A smaller problem is his decreasing Contact%. Right now, it's not a precipitous drop where it looks strikeouts are inevitable, but the lack in change in K rate is fairly surprising. If the contact trend continues, his hyper-aggressive approach will compound the lack of contact, which leads to ugly BB/K rates. He would still be worth the money for this contract, but his 2014 offseason may end up disappointing in that scenario.
Contracts that buy out arb/pre-arb. years are usually very team-friendly, as long as the player doesn't tank Casey McGehee style. The main motivation of the player is to get the guaranteed money, while the team sets payroll and can offset market value increases for those seasons. The Giants gave Lincecum and Cain expensive, yet reasonable, deals during arbitration seasons to keep their price down a bit. If Sandoval can keep his performance near his 2009 and 2011 levels, this will be the best contract of the three.