OpenAI has announced it will open its first permanent office in London, cementing the city as its largest international research hub even as the company separately paused its flagship UK data centre project over high energy costs and regulatory uncertainty.
The ChatGPT maker confirmed on Monday that it has secured a permanent office in London, with plans to make the city its largest research hub outside the United States.
The new space spans 88,500 square feet at Regent Quarter in King’s Cross and has capacity for up to 544 team members. It is expected to open in 2027.
King’s Cross is already home to tech giants including Google DeepMind and Meta, as well as University College London, the Francis Crick Institute, and the Alan Turing Institute. Homegrown AI companies such as Synthesia and Wayve are also based in the area.
One venture capital firm has described the corridor as the world’s third most productive technology cluster after San Francisco’s Bay Area and Beijing.
OpenAI currently employs around 200 people in London across research, engineering, customer support, enterprise, policy, communications, marketing and sales, and says it expects to continue growing its team in the coming years.
Around 30 of those employees are researchers.
Phoebe Thacker, OpenAI’s global head of data research programmes and London site lead, said the UK’s depth of talent and growing adoption of AI tools across businesses and institutions were key drivers of the investment.
“The UK has an incredible depth of talent and a strong track record in AI,” she said.
“This investment reflects our long-term commitment to the UK and the role it can play in shaping how AI is developed safely.”
A Politically Awkward Moment
The announcement comes just days after OpenAI dealt a significant blow to the UK government’s AI ambitions.
Last week, the company confirmed it was pausing its Stargate UK data centre project, citing the cost of energy and the country’s regulatory environment.
Stargate UK was announced in September 2025 as a sovereign AI infrastructure project a partnership between OpenAI, Nvidia, and British cloud provider Nscale to build data centre capacity in north-east England.
The sites earmarked were Cobalt Park near Newcastle and Blyth, both within the UK government’s designated AI Growth Zones.
The project was unveiled during US President Donald Trump’s state visit to Britain, giving it diplomatic as well as commercial significance.
Early plans projected 8,000 GPUs being deployed in early 2026, with the potential to scale to 31,000 over time capacity intended to serve regulated sectors including finance, critical public services, and national security.
The most concrete obstacle OpenAI identified is the cost of electricity.
UK industrial electricity prices are among the highest of any IEA member state, more than four times those in the United States, Finland, Norway, and Sweden.
For a data centre drawing 100 megawatts, that differential is not a marginal concern but a structural one.
Beyond energy costs, regulatory uncertainty around copyright and data access has also slowed investment.
Lawmakers earlier this year considered a copyright exemption that would allow AI developers to use creative works for model training, but the proposal was withdrawn after criticism from content creators leaving companies uncertain about long-term compliance requirements.
In a statement, OpenAI said it would only move forward with Stargate UK “when the right conditions such as regulation and the cost of energy enable long-term infrastructure investment.”
Talent vs. Infrastructure
Benedict Macon-Cooney, chief AI and innovation officer at the Tony Blair Institute, captured the tension, noting that whilst Britain excels as a hub for talent, it continues to struggle to secure the large-scale AI infrastructure needed to compete globally.
Not everyone, however, views the data centre retreat as the more telling indicator of OpenAI’s UK commitment.
Saul Klein, founder of venture capital firm Phoenix Court, argued that signing a commercial property lease is a far stronger commitment than headline-grabbing infrastructure announcements pointing out that leasing office space and filling it with people is not something a company can easily walk away from.
OpenAI is not alone in eyeing London for expansion. Anthropic, its closest rival, is understood to be in discussions with both the London mayor and the government about growing its own UK presence, where it also employs around 200 people.
The government, meanwhile, has sought to reinforce Britain’s credentials in fundamental AI research, announcing £40 million in funding over six years for a new blue-sky research laboratory.
Grid connection delays, planning bottlenecks, and energy costs have all been flagged by industry as barriers to data centre construction issues that predate OpenAI’s involvement but now carry greater political weight. Whether those conditions can improve quickly enough to revive Stargate UK remains an open question.
