Gnabry currently has 12 months left on his current deal at the Allianz Arena. He has been linked with a host of clubs this summer.
According to Sports Illustrated, the Reds have already held talks with the 26-year-old's representatives last week over a possible transfer to Anfield.
Speaking to horseracing.net (via Liverpool World), McManaman lauded the German international's talent before adding that his signing would create "more problems" at Liverpool.
"Serge Gnabry offers something a bit different, he offers pace. He has shown that he is more of a winger than Salah is because Mo likes to cut in from the right and get on his left. Gnabry more so, as in he will drop the shoulder like a typical old-school orthodox winger."
"So I think they can accommodate him from a playing point of view, but again having six forwards would be madness. Sometimes it just causes more problems than you need, and Liverpool's squad is big enough when everybody is fit and well, and if it stays like that, you probably don't need any more players."
He explained why too many internationals in a team can make some players unhappy.
"That’s the thing in the end, ideally, as a manager, you'd want 36 internationals in your squad, but when you can only pick 11 every week, it's harder because everyone gets unhappy."
The former Real Madrid and Manchester City player feels Gnabry does not feel loved at Bayern.
"I think Serge Gnabry is a great player and when I saw him at Bayern Munich, I thought he was exceptional. They've got Kingsley Coman, Leroy Sane and other players and I think at times he just feels as if he is not loved and he is."
Speaking about the player's talent, he said:
"As a player and what he has done recently at Bayern, I think he is very talented and very exciting, I think he would be a good fit for anybody."
Gnabry joined Munich from Werder Bremen in 2017. He has scored 64 goals and contributed 40 assists in 171 appearances across competitions for the Bavarians.
Liverpool head into new season with new-look attack
After failing in their quadruple charge last season, the Reds have refreshed their squad in the ongoing transfer window. Sadio Mane and Takumi Minamino joined Bayern Munich and Monaco respectively on permanent deals last month, with Divock Origi joining AC Milan earlier this week.
To replace the attackers, the Merseyside club roped in Uruguayan striker Darwin Nunez in a deal worth up to £85 million, including add-ons, last month. The former Benfica striker, who scored 34 goals last season, signed a six-year deal at Anfield.
The Reds have also signed youngster Fabio Carvalho for £5 million plus add-ons from Fulham. Although the move was announced earlier in the summer, the 19-year-old's arrival from Craven Cottage was officially completed on July 3.