The 21-year-old has been at the centre of a tussle between Manchester City and Madrid for his services after an eye-catching campaign at Málaga last season.
The Spanish playmaker, who won the European Under-21 championship in Israel this month, has spoken of his interest in a move to both the Citizens and Los Blancos.
But the Real Madrid president Pérez is adamant Isco has his heart set on a move to the nine-time European champions.
“He wants to be a Real Madrid player and Madrid want him,” he said.
City had hoped to lure Isco to the Eastlands outfit after appointing his former Málaga manager Manuel Pellegrini as Roberto Mancini’s successor.
The Spain international scored eight goals and made one assist in 37 appearances last season, and helped Málaga reach the Champions League quarter-finals.
And Madrid centre-half Sergio Ramos backed his club’s pursuit of the young playmaker, who is rated at £25m by his current employers.
“Isco is a great player and anything Madrid does to strengthen with the squad with players of the highest level is always something to be happy about,” Ramos told Spanish radio station Onda Cero.
MORE: Latest Man Utd news
MORE: Latest Arsenal news
MORE: The latest football news