Raised on a hill, surrounded by a moat and bristling with all the anti-terrorist measures known to man, the new US embassy in Nine Elms, south-west London, should be exactly the kind of building that Donald Trump would be only too keen to open. Covered in a prickly translucent plastic skin, which looks cheap, foggy and is already stained, the $1bn cube is in many ways the perfect metaphor for his administration. So why has he cancelled the ribbon-cutting ceremony, planned for later this month?

“Reason I canceled my trip to London is that I am not a big fan of the Obama Administration having sold perhaps the best located and finest embassy in London for ‘peanuts,’” he tweeted, “only to build a new one in an off location for 1.2 billion dollars. Bad deal. Wanted me to cut ribbon-NO!”

London’s new US embassy: a very diplomatic America on Thames Read more

In what actually seems like quite a good deal, the US state department said it has been able to cover the entire cost of the new building in Nine Elms – thought to be the most expensive embassy in the world – by the sale of its other buildings in London, without a single additional taxpayer dollar being spent. It is more likely that Trump’s ire about the deal arises from who the handsome Grosvenor Square mission was sold to – Qatar – and how it reflects the shifting balance of power not only in the UK capital, but across the world.

Adding to its long list of London trophies, the gas-rich emirate snapped up the Mayfair building (for a sum thought to be about £500m) and plans to transform it into a luxury hotel, while the US joins a wider exodus of missions from Mayfair, as many countries realise the property goldmines they’re sitting on. For Qatar, it is merely another jewel in its sparkling crown of luxury acquisitions, an illustrious list of icons that includes everything from Harrods and the Shard, to Canary Wharf and the former Olympic Village. Qatar is now said to own more land in London than the Queen. The US, meanwhile, has been packed off to a swath of south-west London that was, until recently, a wasteland of warehouses and sorting depots. The postcode demotion must burn for someone as thin-skinned and status-conscious as Trump. It’s like moving from Park Avenue to New Jersey.

Built in 1960 to the designs of Finnish American architect Eero Saarinen, the Grosvenor Square mission was one of the most handsome and distinctive embassy buildings in London, but both its design and location were hopelessly inadequate for the US’s increasing security demands. It had made its own premises impossible to use. By the mid-2000s, the genteel Georgian square had been transformed into a scene worthy of Baghdad, littered with concrete road-blocks and bulky guards’ pavilions, but it still wasn’t deemed secure enough. Following a series of high-profile attacks on US embassies elsewhere in the world, US Congress ruled that all embassies must be set back from the street behind a 100ft “seclusion zone”, and be built within a self-contained site of at least four-and-a-half acres.

Nine Elms was a shrewd choice. It was one of the only places in London where the US could dictate the evolution of a masterplan that would put its shimmering cube at the centre of a fortified arc of paranoia, its building set back behind a militarised terrain of berms, mounds and moats, and surrounded by a necklace of some of the most expensive new apartments in the city, whose developers have been eager to cash in on being part of a new high-security “diplomatic quarter”.

Donald Trump cancels London visit amid protest fears Read more

The surrounding “opportunity area” will be home to the first luxury high-rise tower designed by Versace, two towers connected by a glass-bottomed swimming pool, and a block of apartments serviced by a five-star hotel. It is exactly the kind of gaudy place you would expect to find a Trump real estate project – indeed, the Versace tower is being developed by Damac, the same developer that has built Trump’s golf course in Dubai.

If the setup all seems decidedly Trumpian, on closer inspection, the new US embassy building is far too sophisticated and thoughtful to have come from the property tycoon’s administration. Its roof is covered with photovoltaic cells, rainwater is collected and recycled to flush toilets and irrigate the many internal gardens, while a ground-source heat pump provides further renewable energy. It has been awarded Building Research Establishment Environmental Assessment Method (BREEAM) “outstanding” and Leadership in Energy and Environmental Design (Leed) “platinum”, the highest accolades in the British and American ways of measuring environmental performance.

Its design signalled a move away from George W Bush’s grim regime of flat-pack fortresses set behind high concrete walls, being the product of an architectural competition, which kickstarted Obama’s policy of getting some of the US’s best architects to design missions around the world – an initiative which Trump has gleefully cancelled, along with other innovations instituted by his predecessor.

The building is environmentally friendly, as open and welcoming as could be hoped, and it hides its security features in the landscape more subtly than expected. In short, it’s a progressive beacon of the Obama administration, so perhaps it’s for the best that it won’t be tainted by a Trump visit.

• Oliver Wainwright is the Guardian’s architecture and design critic