The France international midfielder has been heavily linked with a move to Paris Saint-Germain, with the Ligue 1 champions' sporting director Olivier Letang rumored to be in Newcastle to help finalize a deal following reports of an initial 17 million euro bid being rejected Sunday.
Cabaye has become a fans favorite at St. James' Park since making the switch from Lille in June 2011, and has drawn attention during a season that has seen him notch seven goals in 19 Premier League appearances.
PSG is reportedly chasing the 28-year-old's signature after coach Laurent Blanc confirmed he is eager to bolster the team's midfield options, and Pardew admits it is feasible he could depart, adding that the club must bring in a suitable replacement if this transpires.
"We know that we've got a club interested in Cabaye who are very wealthy and powerful," he told reporters. "We're conscious of that, but we will be doing our best to protect Newcastle United. Am I confident [of retaining Cabaye]? No. I don't think any team not in a Champions League position, or fighting for a Champions League position, would be different.
"We would need to bring someone in, that's for sure. You can't lose someone of his ability and not replace him. But we're going to need some time to do that. We've informed the club that are interested, and the agents that we're very conscious of that."
While the Frenchman's immediate future remains unclear, Pardew confirmed Newcastle is edging toward concluding a deal for an unnamed target.
He added: "We hope to sign a player outside the Cabaye situation for the second half of the season and we're a little bit closer with that."