The problem is not that you can't legally build a city like SF in the middle of nowhere. There are hundreds of smaller cities that could grow into bigger ones, but their population growth just isn't there. People wouldn't come to your "New SF" either.

The real problem is:

- Many people choose to live in big hubs like SF or Manhattan because that's where the high paying jobs are

- You can't legally turn SF into Manhattan (i.e. making it denser)