Sydney FC sign Ben Warland from Adelaide United, monitor Fabio Ferreira

Sydney FC have confirmed the mooted signing of Adelaide United defender Ben Warland and are set to complete a deal with Fabio Ferreira in the coming days.

One day after rejecting a first bid, the Reds reluctantly released Warland on Wednesday after the 21-year-old made clear he wanted to move join the Sky Blues in a deal until the end of the 2018-19 A-League season.

It's understood Graham Arnold has been impressed with what he's seen of Warland over the past year and had identified the left-footed centre-back as an ideal and affordable replacement for Sebastian Ryall.

"I've watched him from afar for a while now and I'm impressed by the potential he's shown," Arnold said.

"He'll possesses all the right traits to be a Sky Blue and he'll fit in well with this squad."

Reds chairman Greg Griffin confirmed the club's release of Warland despite their desire to keep him.

"Sydney offered us a young player for Ben but we're very happy with the other locals we have in the squad and we rejected their offer," Griffin told News Corp.

Sydney have also been on the hunt for a wide attacker to bolster their domestic title defence ahead of a busy schedule featuring a looming Asian Champions League campaign.

One import slot remains free and is likely to go to Ferreira, who has proved his fitness training with Sydney and has Australian citizenship, though not for the minimum 12-month period required to be an ACL option.

The Portuguese winger's status as a free agent means he can still be signed after the transfer window closes at midnight.

Salary cap constraints have significantly influenced Sydney's January recruitment.

A large proportion of Ryall's wages came from outside the cap under the loyalty exemption for players who have spent a long period at one club, meaning his departure left little to spend.

"Fabio has been with us now for 10 days, he's training with us," Arnold said.

"He's one of half a dozen players [being looked at] that are off contract.

"We've still got a foreign position open, and obviously it's explained to that foreign player that it's A-League only, because you can only take three foreigners [to the ACL].

"I hardly slept last night, my phone was going nearly all night from agents all around the world putting players forward, because everyone wants to come to Sydney FC.

"It's just a matter of managing the salary cap and making sure we've got the money, but with the loan system that's in place as well you can also loan players."