In 1982, a group of sex workers occupied a church near King's Cross for twelve days to protest police harassment. More than four decades later, Anthropic has leased roughly 158,000 square feet of office space in the very same neighborhood — enough to house 800 people, four times its current London headcount. Put those two numbers side by side, and you get the most honest summary of King's Cross's last two decades.
This was once one of London's most notorious corners, where cocaine and heroin deals ran rampant throughout the '80s. The real turning point came in 2016, when DeepMind — recently acquired by Google — chose to set up shop here. Hussein Kanji, an investor at Hoxton Ventures who moved to the area back in 2005, calls today's King's Cross "the hotbed of UK AI." Once DeepMind moved in, startups followed in waves — OpenAI, Meta, drug-discovery company Isomorphic Labs, and materials science startup Cusp AI all popped up within a few blocks, with Synthesia and Anthropic a bit further out. Earlier this year, both OpenAI and Anthropic announced new locations here, with Anthropic straight-up calling London its "most important hub outside the US."
Rents Up Nearly 18% in Three Years, Vacancy Down to 0.9%
The clustering effect showed up in leases first. According to Knight Frank, AI-related companies have leased over 1 million square feet of office space in London since June alone. Prime rents in King's Cross have jumped 18% over three years, and vacancy for traditional office space has dropped to just 0.9%. As Knight Frank's commercial analyst Chris Dunn put it bluntly: "Demand is massively outstripping supply."
The money's flowing the same direction. Dealroom data shows London now has roughly 3,600 AI startups, which have collectively raised $14.8 billion since late July — with $12.1 billion of that, over 80%, going straight to AI companies. As Nik Sharma, co-founder of biotech startup BioCorteX, puts it: "A lot of hyperscalers are moving in."
The Salary War: How Do Local Startups Compete With £630K Paychecks?
But the arrival of these giants has thrown the talent market into chaos. Machine learning research engineers at Anthropic earn between £260,000 and £630,000 a year, while recruiting firm Robert Half puts the average London salary for equivalent roles at just around £102,000 — a gap of several multiples that local startups simply can't match head-on. Synthesia's Chief People Officer Laura Gonzalez Florez has adapted by casting a wider net, saying there's "no friction" working with talent "from Slovenia to Portugal," while London itself remains valuable for being "close to the airport, and very close to investors."
The pay gap is also fueling bigger anxieties. Phoenix Court co-founder Saul Klein put it plainly: "We'd better learn to look after ourselves." Fellow co-founder Robin Klein called it "a small but sharp wake-up call" — a reminder that Europe can't just rent AI capability, it needs to build its own infrastructure and flagship companies.
In twenty years, King's Cross has gone from the site of a sex workers' church occupation to a place where Anthropic can sign a lease for an 800-person office in one go. As Zain Ali, founder of AI legal startup Centuro, says, the real test is just beginning: "The key question is whether more globally influential AI companies can actually be founded, funded, and scaled right here in the UK." Attracting the branch offices of giants is one thing. Growing the next giant from scratch is another.
