Rooney, United and England's all-time top-scorer, said: "The club needs to rebuild with younger players but they need to be good enough and I think the fans will understand that they are probably not going to compete for the Premier League next year".
"Daniel has successfully completed a medical at the Aon Training Complex".
Manchester United have agreed a deal to sign Welsh global winger Daniel James from Championship side Swansea City, the English Premier League club said on Friday.
James had been close to joining Leeds in January before the move collapsed at the 11th hour, but is poised to sign for the Whites' arch-rivals.More news: Chelsea appeal FIFA transfer ban to CAS
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The deal is expected to go through when Fifa's global transfer window opens next week.
James will be the first new arrival of the summer at Old Trafford and the first signing for new manager Ole Gunnar Solskjaer, after both Swansea and United announced the transfer on Friday.
"So let them have that time, let Ole have that time to build a team for the next two or three years who are going to compete, not only at Premier League level, but at Champions League level".
He progressed through Swansea's academy after joining from Hull City in 2016 and scored five goals in 38 appearances in all competitions this season.
Following the death of his father, he withdrew from Wales' training camp in the Algarve last month, but made himself available for Giggs' squad for the Euro 2020 qualifiers in Croatia on Saturday and in Hungary next Tuesday.