Regulation isn't really the limit there. Regulation is the mechanism that implements the limit. The limit comes from the combined views of the citizenry about what sort of place they'd like their city to be.
But I'll note that just last year there were a pair of ballot propositions where circa 2/3rds of voters rejected raising height limits for a big new project:
http://ballotpedia.org/8_Washington_Street_Development-Initi...
And having lived here quite a while, I'm sure it's not only wealthy landlords who are opposed to unrestricted high-rise development.
It's existing renters who are stopping new development. Long term renters have fantastic rates because of how rent control laws are written. And they want to keep their rent low (for themselves, new arrivals can get screwed), their streets sunny (instead of being overshadowed by high rises), and their neighborhoods not too crowded.