Officials decided it would be impossible to retrofit the ageing modernist building, opened in 1960, with the security needed in the post-9/11 world.
AT least Theresa May was spared some embarrassment when President Donald Trump chose to blame his predecessor Barack Obama for his impromptu decision not to visit London next month to officially open the new American Embassy.
"Bad deal. Wanted me to cut ribbon-NO!" the USA president added.
A pillar of Britain's foreign policy since World War Two, the so-called "special relationship" with Washington has taken on added importance as Britain prepares to leave the European Union in 2019 and seeks new major trade deals.
Bemused construction workers and passers-by took selfies with the Trump waxwork, which was first unveiled at Madame Tussauds in January a year ago.
Thomas Cole, head of policy for the cross-party, pro-EU group Open Britain, said Trump was "showing early signs of panic here [and is] perhaps less committed to a bilateral [trade] deal with United Kingdom than some had thought".
"The U.S.is one of our oldest and most valued allies and our strong and deep partnership will endure", the spokesman said.More news: Seal accuses Oprah Winfrey of knowing about Weinstein's sexual behaviour
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During May's U.S. trip a year ago, she extended an invitation to Trump to make a formal state visit - which includes pomp, pageantry and a banquet with Queen Elizabeth.
However, London's mayor Sadiq Khan, who has been a target of Mr Trump's twitter tirades, said the president had "got the message" that he was not welcome in the United Kingdom capital. "It seems he's finally got that message", Khan tweeted.
"We will not allow US-UK relations to be endangered by some puffed-up, pompous popinjay in City Hall", Johnson tweeted.
"The project has been executed within the established budget", an embassy spokesman said, adding it had "considered more than 50 sites" in London ahead of the move, which cost up to $1billion and "used no tax dollars".
"I think we have to welcome the American President to Britain", Johnson said.
Residents in the up and coming area of Nine Elms got to see the US President after all when the world-famous museum relocated their life-size waxwork of the former reality star from Baker Street to outside the new $1 billion US embassy.