This problem is fundamentally a coordination problem, where land is conditionally valuable based on whether multiple lots can be purchased in tandem, and thus the value is based on getting everyone to sell at the same time. If the billionaires had known in advance that lots of existing landowners would pull this, they would have gone and bought land elsewhere, and the existing landowners would get nothing.

What's more, the billionaires are clearly offering a clearly profitable deal for everyone, specifically so that nobody has an excuse to refuse and cause the coordination problems mentioned. And because they bought at well above market price, they're stuck with dead weight if they don't go through with the affair.

In other words: the existing landowners are 1) demanding money well above the inherent value of the land, and 2) this mechanism/behavior of the existing landowners isn't useful to society/the economy as it makes it harder to do things that require lots of land. This is a textbook example of where government intervention is useful, if done competently and not corruptly.