[lotsofpulp]

Prices are set by the highest a seller is able and willing to pay, and the lowest a buyer is willing and able to accept (absent collusion).

It is clear that in certain US metros, sellers are both able and willing to pay a lot, and buyers are not willing to settle for less, because they can find other sellers able and willing to pay more.

Higher land prices come downstream of that. No one is stopping businesses from paying less in areas with lower priced land, but evidently, it is more difficult to make a successful, highly profitable business in lower priced areas.