The Champions League holders are willing to concede defeat in the battle to make Mateo Kovacic a regular first team player at the Santiago Bernabeu.
Adoptive club Chelsea are the favourites to retain the services of the Croatian midfielder on a permanent basis, although they may face competition from rivals Tottenham Hotspur should the player be made available.
In a report by the Spanish newspaper 'AS', Real were unimpressed with Kovacic's attitude when he returned from the World Cup, as he tried to force his way out of the club.
The Spanish giants sanctioned a move to Chelsea as a compromise with the player, but are keen to off load him from the wage bill, as they do not want to have him back.
Real payed Inter Milan £27million for the Croatian three years ago, and will look to make a profit, should they decide that he can leave the club on a permanent basis next summer.
Reports in Spain suggest that talks between Real and Chelsea have already begun, yet, as previously mentioned Mauricio Pochettino is keen to add the player to his Tottenham squad.