This happens to some extent in some places - e.g., a large amount of private apartments in Singapore are built in 99 year ground leases. The problem is that you

This happens to some extent in some places - e.g., a large amount of private apartments in Singapore are built in 99 year ground leases. The problem is that you end up with a 50 year old building that is falling apart and should be redeveloped, but it's not worth it on a 50 year lease, or you need to negotiate a complicated and expensive lease top-up. Lots of important land uses like airports, factories, train stations require huge investment with returns spread over decades or centuries, it would be harder to get people to make these investments on leased land.