President Donald Trump blamed his decision not to visit the UK on a "bad deal" negotiated by the Obama administration.
The US embassy in London says the plan to the finance a new embassy goes back to the George W. Bush administration.
London Mayor Sadiq Khan said that Trump would have been met by mass peaceful protests if he came to the UK.
He blamed the cancelled visit on the "off location" of the new embassy, which is moving from Grosvenor Square in Mayfair to Nine Elms, south of the Thames.
Asked about the PM's views on south London after the president described the embassy's new site as an "off location," the Number 10 spokesman said: "I think Vauxhall is a vibrant and important part of London and home to many businesses.