Palacios scored 14 goals for the Castilla in the 2025-26 campaign — the second-highest total in Primera RFEF's Group 1, behind only Enric Gallego of Tenerife. He also made seven appearances under first-team coach Álvaro Arbeloa, including a debut in the Champions League against Benfica in February, accumulating 83 minutes of top-level exposure.
According to AS, both Osasuna and Como have formally expressed interest. Athletic Club had also been in the frame but withdrew after deciding that Real Madrid's standard conditions — a 50 per cent sell-on fee, a buyback clause, and a right of first refusal — were incompatible with their transfer policy.
Osasuna's interest carries a personal dimension. Palacios was born in Soria but registered in Pamplona, where his family moved the day after his birth. His father, also named César Palacios, played 208 times for Osasuna and was one of the club's key figures in the early 2000s. Diario de Navarra confirms that Osasuna have already made direct contact with the player.
Como's appeal operates on a different basis entirely. The Italian club — managed by Cesc Fàbregas and freshly promoted to the Champions League — have a proven track record of developing Castilla exports. Nico Paz arrived from Real Madrid for minimal cost and became a key figure at Como before the club triggered a €9 million buyback clause. Jacobo Ramón followed a similar path.
Real Madrid value the 50 per cent ownership stake they retain on players sold under this model. Their asking price for outright transfer of Palacios has been reported in Spanish media at approximately €60 million — a figure designed to either attract a major bid or ensure the club retains co-ownership.
The club's preference, according to AS, is to include a buyback option in any deal. They want to keep their hold over a player they regard as a future first-team candidate.
Palacios turns 22 in November. He knows the timing is right. The only question is where he goes next.