Commercial RE too. When you say supply is constrained, they don’t mean there’s no RE available, they mean RE isn’t available at a lower price. Most cities in the US right now have a huge commercial RE vacancy rate, yet if you try to lease it, you’re not getting rates that a free market low demand situation is going to get you.

Yes it is. There's no zoning law that says "You can only build houses here, no apartment, unless you build commercial real estate"

Commercial real estate is generally illegal anywhere dense housing is also illegal.