Nobody builds them, because people don't want to live in them. I lived in a "small" apartment building with like 8 units in New Orleans, and also in Seattle. They tend to be older, quaint, and rife with issues... heaters that don't distribute heat evenly, no amenities like a "full-size" apartment complex would offer (gym, pool, covered parking, in-unit washer / dryer hookups, proper cooking ventilation, someone to sign for package delivery, etc.), and not nearly enough sound insulation. Granted these things could probably be slightly improved with new buildings... but for a housing developer... why go through all the hassle of getting a lot zoned for multi-family if it's "cheaper for renters" (meaning probably less profit margin).
Having lived in small apartments and big apartments, and having my own house now... man, I love having a yard and space and not worrying about a line when I go to do laundry. But if I had to go back to apartment life, I'd want one of the big, resort-style complexes that felt like a college campus.