So it appears for us the solution was to change the storage controller. We were running Horizon 7.13 on vSphere 6.7 using the NVMe controller and everything was fine. We started having this issue when we upgraded to vSphere 7. We worked with VMware for a week or so and they couldn't find any answer for us and the issue would occur not matter what was tried. New images, existing images with and without agents, varying compatibility modes and vmtools versions, etc. Then internally we moved to testing the virtual hardware and found that when we changed the storage controller from NVMe to SCSI the issue stopped and all VMs were building successfully again. Not sure why or what issue occurs between vSphere 7 and the NVMe controller that causes this but changing back to SCSI seems to have fixed the issue for us. 

Hopefully this info might be of some use in fixing your issue.