Cities emerged due to geographical reasons, (i. e. to have easy access to minerals, or to be close to waterways) and are formed because of location decisions by both firms/business and workers/people.
Those location decisions create agglomeration economies, when workers and firms cluster together.
Most of the cities in the world, follow the monocentric model. Is the assumption that exists a Central Business District (CBD), where buildings are more expensive and employment density is greater, and the surrounded areas where most of residential homes and some industry are located.
Tokio - Japan. World's biggest human agglomeration.
Business locate in cities to access to a large number of customers, and to easy access to the existing net of transport infra-structures.
People move in to cities because the benefits of living in the city out came the costs.
The Economic benefits include access to work, industry, trade and an income.
The Social advantages, include the opportunity to know people with the same interests, backgrounds. To access to hospitals and other services, education, and sports or cultural events.
For the first time 52% of world population lives in urban areas.
There's more people moving in to cities, this kind of agglomeration will affect supply and demand of real estate.
More people and business location in the same area, means grater demanding for land meaning higher prices.