Alphonso Davies is a really great talent in my opinion. He didn't have a bad season either. I would absolutely like to keep him in the team if I were them. He is only 23 years old with this talent so he can play for long years. 
Real Madrid has been mainly interested in him as far as I know. They are after many talented players in this transfer window as it seems. They have Ferland Mendy and Fran Garcia as left-backs for now. Fran Garcia is more like a backup player though. However Mendy hasn't been playing impressively in the recent two years. His average rating has been below 7.0 in these seasons. Real Madrid would probably have Davies in the starting eleven if they sign him.
Real Madrid has been mainly interested in him as far as I know. They are after many talented players in this transfer window as it seems. They have Ferland Mendy and Fran Garcia as left-backs for now. Fran Garcia is more like a backup player though. However Mendy hasn't been playing impressively in the recent two years. His average rating has been below 7.0 in these seasons. Real Madrid would probably have Davies in the starting eleven if they sign him.
I will not want to stay longer if a club like Real Madrid comes knocking, he should follow the steps of David Alaba and Toni Kroos because these are player's he played with before now and he should have known better how well they're doing with Real Madrid. With his pace and IQ, he will bring a lot into the squad and the attacking football they want to play.
Davis is on another level, did you see that goal he scored against Real Madrid in the Semi Finals?
He wanted to show Real Madrid fans how much quality hes got. He shouldn't hesitate once the agreement with Real Madrid is settled, Bayern Munich will have no other option but to accept it.
You cannot force a player who wants to leave to stay. This Real Madrid side next season will be deadly, I see why club president has said they can't wait to win the 16th Champions League Competition.