This is according to the Daily Star, who understand that Arsenal must now agree a fee with the reigning European champions in order to sign the 27-year-old when the transfer window re-opens in January.
Arsenal hope to secure cut-price deal
Reports from Spain claim that Gunners boss Arsene Wenger hopes to strike a cut-price deal with Real Madrid for the German World Cup winner, who has also been strongly linked with Manchester United and Chelsea over recent weeks.
But Arsenal appear to have convinced the £200,000-a-week star to come to Emirates Stadium, where he would join up with international teammates Mesut Ozil, Lukas Podolski and Per Mertesacker, plus fellow Germans Serge Gnabry and Gedion Zelalem.
Real Madrid are open to negotiations over a transfer fee, with Khedira able to walk away from the Bernabeu on a free at the end of the season, when his contract expires.
Man United and Chelsea still in the hunt
Despite the fact Khedira has agreed terms with Arsenal, there’s still a chance that Chelsea or Manchester United could beat Wenger to the experienced holding midfielder.
Both Premier League clubs have the financial resources to tempt the former VfB Stuttgart star to either Stamford Bridge or Old Trafford - and his decision is likely to come down to which club offers him the most lucrative contract.
But Arsenal can offer him guaranteed first-team football, and there now appears to be a very real possibility that Khedira will become the Gunners’ next star signing.