Unfortunately, I think this is a 'tragedy of the commons' kind of situation. Existing landowners (or at least groups of them) are incentivized to hoard the land-wealth by vetoing construction on their valuable land. What those landowners are missing is that everyone would be better off if land could be put to its most profitable use.

The resulting higher density of land-use would likely result in each landowners property becoming even more valuable. Imagine owning a single-family-housing-sized lot in the middle of New York City, for example.