Peter Seidler sat in the crowd at a spring training game, enjoying the splendor of a March afternoon in Arizona. On the field was a team that critics suggested would cost him dearly.It was 2023, eight months before Seidler would succumb to an infection related to a compromised immune system at age 63, and three years before a family feud over control of his beloved San Diego Padres resulted in a deal that left the industry in shock.That offseason, Seidler had again defied the playbook for how a small-market club was supposed to operate. The Padres owner gave third baseman Manny Machado an 11-year, $350 million extension. He landed free-agent shortstop Xander Bogaerts with an 11-year contract worth $280 million. A franchise previously defined by frugality would enter Opening Day with baseball’s third-highest payroll, even as the rest of the industry waited for the bill to come due.“Part of our thinking as an organization,” Seidler told The Athletic that spring day in Arizona, “is we just believe in the future of Major League Baseball.”Now, that belief has produced a price tag no one saw coming. Despite a 58-year history without a championship, despite the sport’s smallest television market, despite myriad other factors that might suppress their value, the Padres changed hands this week at a $3.9 billion valuation, the highest number ever realized in the sale of a baseball franchise.On Monday, José E. Feliciano and Kwanza Jones were approved to purchase a controlling stake in the team. The deal shattered MLB’s previous valuation record, established when Steve Cohen bought the New York Mets for $2.4 billion in 2020. San Diego’s incoming owners framed it as an opportunity to build on the legacy of an owner who bought the team in 2012 for $800 million.“We are grateful to the Seidler family, and especially to Peter, for raising the expectations of what this franchise can achieve,” Feliciano and Jones said in a statement ahead of their introductory press conference next week at Petco Park.A scion of the family that owned the Los Angeles Dodgers for a half-century, Seidler often spoke about beginning a similar dynasty in San Diego. But after his death, his widow sued two of his brothers in an attempt to gain control of the team. The Padres ultimately were put on the market, which was not part of Seidler’s vision.According to multiple people who worked closely with the late chairman, he never made it a stated goal to increase the franchise’s value.“It never was,” said Padres chief executive officer Erik Greupner. “And it still isn’t.”How did it happen anyway? How did the Padres, of all teams, emerge as the most expensive MLB franchise ever sold? In recent weeks, The Athletic interviewed current and former club employees and other industry officials, some of whom spoke on the condition of anonymity to discuss sensitive matters. The answers include a deliberate gamble on payroll, a city that no longer hosts any other Big Four team, a rise in the value of live sports, and a record-setting wager on a version of baseball that does not yet exist.“I thought $3 billion would have been a home run,” said one person who was involved in the sale process. “It was an outcome that surprised all of us.”The bet no one else would makeRon Fowler counted nickels. A longtime San Diegan and self-made multimillionaire, he built his fortune in beverage distribution, a business of thin margins and strict discipline. When he and Peter Seidler bought the Padres in 2012, Fowler ran the club the way he ran most things — with budgets, forecasts and a healthy skepticism toward anyone asking for more money.The man asking was usually A.J. Preller, a first-time general manager with a reputation for aggressiveness. By the end of the 2018 season, Preller had rebuilt the farm system and signed first baseman Eric Hosmer to an eight-year, $144 million contract. However, the major league roster was still awaiting more investment.Then Manny Machado hit free agency, and Preller went to Fowler.What followed, according to a person familiar with the deliberations, was an internal negotiation that ran alongside the external one. Preller pushed for spending authorization in stages, returning each time for more as Machado’s camp declined to engage, until the infielder’s representatives finally agreed to a meeting.San Diego Padres chairman Peter Seidler, left, and general manager A.J. Preller, pictured here in 2023, teamed up to turn the once-frugal Padres into lavish spenders. (Denis Poroy / Getty Images)Fowler and Preller ultimately signed Machado to a 10-year, $300 million contract that included an opt-out after the fifth year. A couple of years earlier, even $200 million would’ve been an unimaginable number in San Diego. The deal was briefly the largest free-agent contract in North American sports history, handed out by a franchise that had carried a top-10 payroll only once before.“I think (fans were) used to players going away from San Diego … especially when it was time to get paid,” Preller said recently. “Manny was the guy that started to change that perception for everybody.”The year after Machado’s arrival, in a season shortened by the coronavirus pandemic, the Padres reached the playoffs for the first time since 2006. Weeks later, Seidler succeeded Fowler as chairman.A grandson of former Dodgers owner Walter O’Malley, Seidler had been raised around one of the sport’s blueblood franchises. Like Fowler, he did not accept that a smaller market meant smaller ambitions. Unlike Fowler, he would not demonstrate much restraint.On Opening Day 2021 — after a blockbuster offseason that included the acquisitions of pitchers Blake Snell, Yu Darvish and Joe Musgrove — the Padres fielded a payroll of $176 million. It was the sport’s eighth-highest figure and nearly $70 million above San Diego’s previous record for a full season.“The strategy that Peter and A.J. and I discussed,” said Greupner, the team’s CEO, “was that we would (start by) increasing major-league payroll and showing the fans that there was a commitment to put a consistently winning and playoff-caliber team that could compete for a championship on the field.“Then the challenge and the task on the business operation side was, ‘OK, now that we’ve done that, how much can we increase revenue in service of supporting that level of payroll?’”The fans supplied the response. Since 2021, the Padres have twice missed the postseason amid high-profile disappointment. They’ve also ranked among MLB’s top five in attendance every year, and San Diego is on pace to draw 3 million fans for a fourth consecutive season, a group that otherwise includes only the Dodgers, Philadelphia Phillies and New York Yankees. Sponsorship over the last six years has grown by about 140 percent, according to Sergio del Prado, the team’s executive vice president of business affairs. The number of corporate partners is up nearly 50 percent.Some of this was luck. When Chargers owner Dean Spanos moved the NFL team to Los Angeles in 2017, San Diego became the only MLB city without another Big Four franchise, handing the Padres an undivided share of the region’s attention and disposable income. “Let’s be very real,” said one member of an MLB ownership group. “Who the Seidlers really had to thank was Dean Spanos.”