He has Premier League experience having spent a two-year spell at Aston Villa, leaving in 2016.
However, while back on loan at former club Deportivo last season, the 29-year-old was responsible for creating a thoroughly impressive 79 chances for his teammates in 35 La Liga appearances, leaving him second only to Lionel Messi (87) in that regard.
"I chose to come here because, first, it is the Premier League, second, it's a lovely club and the fans are always helping the club and, third, for me it's an incredible opportunity and an wonderful project the club are leading, being ambitious and keen to achieve good things".
"I'm very happy to be here at such an historic club", he said in a statement on West Ham's website.
West Brom have emerged as surprise contenders in the race to sign Fiorentina midfielder Carlos Sanchez, with West Ham also keen.
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However, the striker then opted to return to Deportivo on loan last season in search of more regular first-team football.
'I'm very happy to be here.
He is Manuel Pellegrini's ninth summer signing and their second from Arsenal after the capture of Jack Wilshere.
"He is a very experienced player that Manuel and I both know well from Spain", said Husillos.
West Ham have been looking for a new striker to bolster their attacking options and now look set to land Perez on a permanent deal.