Urbanization and limited land availability have resulted in the increased utilization of underground structures including residential basements in largely populated cities such as London, with an average addition of 200 basements per year in some boroughs. Residential basements kept at a comfortable temperature level throughout the year significantly contribute to heat fluxes in the subsurface as well as an increase in ground temperature. Understanding the ground thermal status is crucial in managing the significant geothermal energy potential in urban areas as well as the sustainable development of the urban underground, and in maintaining the energy efficiency of underground structures. In this proof-of-concept study, a 3D finite element approach accounting for coupled heat transfer and groundwater flow in the ground was used to investigate the influence of ground conditions on the heat rejection rate from basements. A detailed analysis was made of ground, above ground and underground built environment characteristics. This study demonstrates that the amount of heat from basements rejected to the ground constitutes a significant percentage of the total heat loss from buildings, particularly in the presence of groundwater flow. The extent of thermal disturbance in the ground varies depending on the ground characteristics. The volume of thermally disturbance ground inversely correlates with the groundwater flow rate in ground mainly consisting of highly permeable material. However, a direct correlation exists when the thickness of permeable soil layer decreases. A larger horizontal to vertical ratio of ground thermal disturbance is observed when the thickness of permeable soil layer increases.