Have you talked to your "failing" team member about this? Have you worked together to try and identify a path towards improvement? Off the top of my head, perhaps they would benefit from more WFH time? Or perhaps a period of part-time work? Perhaps their duties could be shifted around so that they can contribute in a different way for a while? Could they take over some of your mentoring duties?

I mean, this is the bread and butter of your job as a manager, right? Getting the best out of your people?