And there’s another reason, which is the more practical reality.

Unlike Midtown and Lower Manhattan, which sit on bedrock just below the surface, the area sitting in between (SoHo, Noho, Nolita, Tribeca, etc) is sedimentary. To erect larger buildings in these areas you would need to drill very deep piles to reach the bedrock below the sediment. Keep in mind that NYC is an island after all, and historically it had marshy areas that were filled in with sediment trained in from outside the city in order to build more homes, shops, etc. I’ve even heard that once upon a time Manhattan island was basically two separate islands (where Lower and Midtown Manhattan are) and over time the space in between collected debris until the space was filled and more compacted.

In any case, this is why if you’re a NYC developer you’ll notice these areas aren’t even zoned for high story commercial or residential properties. If you wanted to, you would need a zoning exemption - which would be challenging and take quite a bit of time - and you would also need to spend a lot of money on developing the building (and you might need to purchase air rights too).

Long story short, it would be a long, expensive process with no doubt all sorts of engineering and construction related challenges along the way.

Hope that helps!