The deal is for $5.75 million with $1.5 million available in performance bonuses, per Joel Sherman of the New York Post.
The 29-year-old is entering his seventh major league season after six with the Pittsburgh Pirates. A 2013 All-Star selection, he led the National League with 36 home runs that season.
He's a feast-or-famine hitter at the plate, as he's hit at least 27 home runs in seasons when he's played at least 149 games, but he hasn't batted better than .244 in those seasons.
Alvarez did show improvement in the strikeout department, though. After striking out over 180 times in 2012 and 2013, Alvarez only did so 131 times in 2015.
However, the Orioles didn't necessarily need Alvarez, who has played first and third base during his career with the Pirates. Baltimore re-signed slugging first baseman Chris Davis this offseason to a seven-year, $161 million deal, per Spotrac, and has third baseman Manny Machado bringing a power bat and a Gold Glove to the hot corner.
Last year, Machado launched 35 home runs, and the Orioles have Mark Trumbo to complement Davis. Alvarez could be an option at designated hitter but would be rotating with Davis and Trumbo for at-bats there.
Alvarez will need to get comfortable with not having a set position on the field and in Baltimore's lineup as the Orioles look to contend for the American League East title.
Stats courtesy of Baseball-Reference.com.