David Moyes has scouted the 24-year-old as he prepares to overhaul his Manchester United squad in the close season after a disappointing campaign, while Kroos admitted on Monday that "anything is possible" regarding a move to England.
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"I said to him you have time to become an even better player," Guardiola told reporters. "I hope he maintains this level of form - and for the next few seasons at this club.
"Toni is a young player, a great talent. He has time to improve, to gain better his skills. I spoke with him and said you have time to become a better player.
"He was very important in my first year here, in the first part of the season when [Mario] Gotze , [Javi] Martínez and Thiago [Alcantara] were injured, so we had few midfielders.
"Kroos with his huge personality, was very important."
Kroos' impressive performance for Bayern in the first leg of their Champions League last 16 tie against Arsenal at the Emirates attracted further transfer speculation, while Die Roten host the Gunners on Tuesday with Arsene Wenger's men looking to overturn a 2-0 deficit.