The defender has underlined the importance of the former Liverpool man, while also hailing Gareth Bale
The 32-year-old signed a new contract until the summer of 2016 with Madrid earlier this week and Arbeloa is delighted that Alonso has decided to stay on for two additional seasons.
"It would have been a blow if he’d have gone. There is no other player like him in the world to replace him," Arbeloa was quoted as saying on the club's official website.
"It is great news for everyone associated with Real Madrid and for him too, so everyone is happy."
The defender also briefly discussed the form of Gareth Bale following the Welshman's appearance in the 2-0 Copa del Rey win over Osasuna on Thursday and underlined the importance of the winger to Madrid.
He added: "He did well and we're glad that he is with us."
Madrid resume La Liga action on Sunday away against Espanyol.