The 28-year-old has attracted interest from the likes of PSG, Inter Milan and Bayern Munich, but the Gunners are understood to be at the front of the queue.
AS reports that the Premier League side are offering a deal worth €35 million, made up of a €32 million fee plus €3 million in add-ons.
Real Madrid are looking to sell some of the squad players deemed surplus to requirements by Zinedine Zidane after splashing out large sums already this summer on Eden Hazard, Luka Jovic and Ferland Mendy.
Vazquez has been told by Zidane that his game time will be limited next season if he stays, so working under Gunners boss Unai Emery could be an attractive proposition for the Spain international leading up to next summer’s Euro 2020 finals.
Los Blancos want to complete a deal as soon as they can, with the first-team squad preparing to fly to Montreal next Tuesday for the start of their pre-season tour.
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