A new US embassy is to be built in London, ambassador Robert Tuttle announced today.
It will be in Wandsworth, south London, and the existing building in London's Grosvenor Square will be offered for sale almost immediately.
The deal is conditional on the approval of US Congress and planning authorities in Britain.
Mr Tuttle told reporters at the Embassy: "I have signed on behalf of the US Government a conditional agreement with the real estate developer Ballymore to acquire a site in the Nine Elms Opportunity Area in Wandsworth for the construction of a new embassy.
"This has been a long and careful process. We looked at all our options, including renovation of our current building on Grosvenor Square.
"In the end, we realised that the goal of a modern, secure and environmentally sustainable embassy could best be met by constructing a new facility.
"I'm excited about America playing a role in the regeneration of the South Bank of London."
He said the existing embassy building would be offered for sale almost immediately.
"I do want to stress that this is the beginning of a lengthy and multi-step process, and it requires Congressional approval and that of the local planning authorities, and we will remain here until the process is completed and we are ready to move.
"If we are not able to move forward, we will probably renovate this building."
He said the global real estate firm Cushman & Wakefield is advising the Overseas Buildings Operations Bureau, which directs the State Department's worldwide facilities programme, on the project.
Mr Tuttle, who led the search for a new site, added: "We wanted the site to be as close to Parliament and Government buildings as the current site, and we have achieved that."
He declined to discuss the cost of the deal, saying it is confidential.
Sean Mulryan, chairman of the Ballymore Group, said: "We are delighted the United States Embassy has chosen to invest in our Nine Elms project.
"The new embassy will serve as a catalyst for the regeneration of the area."
The embassy is the United States' largest in Western Europe and one of London's most recognisable buildings.