LSP server fails to initialize with: "Failed to find all versions of .NET Core MSBuild. Call to hostfxr_resolve_sdk2."

[keyboardDrummer]

Environment data

dotnet --info output:

rwillems@bcd0745419f2 roslyn % dotnet --info

Host:
  Version:      8.0.6
  Architecture: arm64
  Commit:       3b8b000a0e
  RID:          osx-arm64

.NET SDKs installed:
  6.0.407 [/usr/local/share/dotnet/sdk]
  7.0.202 [/usr/local/share/dotnet/sdk]
  7.0.305 [/usr/local/share/dotnet/sdk]
  7.0.306 [/usr/local/share/dotnet/sdk]
  8.0.100-preview.5.23303.2 [/usr/local/share/dotnet/sdk]
  8.0.100-preview.6.23330.14 [/usr/local/share/dotnet/sdk]
  8.0.101 [/usr/local/share/dotnet/sdk]
  8.0.203 [/usr/local/share/dotnet/sdk]
  8.0.301 [/usr/local/share/dotnet/sdk]

.NET runtimes installed:
  Microsoft.AspNetCore.App 6.0.15 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 7.0.4 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 7.0.8 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 7.0.9 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 8.0.0-preview.5.23302.2 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 8.0.0-preview.6.23329.11 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 8.0.1 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 8.0.3 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 8.0.6 [/usr/local/share/dotnet/shared/Microsoft.AspNetCore.App]
  Microsoft.NETCore.App 6.0.15 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 7.0.4 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 7.0.8 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 7.0.9 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 8.0.0-preview.5.23280.8 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 8.0.0-preview.6.23329.7 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 8.0.1 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 8.0.3 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
  Microsoft.NETCore.App 8.0.6 [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]

Other architectures found:
  x64   [/usr/local/share/dotnet/x64]
    registered at [/etc/dotnet/install_location_x64]

Environment variables:
  Not set

global.json file:
  /Users/rwillems/SourceCode/roslyn/global.json

Learn more:
  https://aka.ms/dotnet/info

Download .NET:
  https://aka.ms/dotnet/download

VS Code version: 1.89.1 C# Extension version: v2.31.19

OmniSharp log

Using dotnet configured on PATH
Dotnet path: /usr/local/share/dotnet/dotnet
Activating C# standalone...
waiting for named pipe information from server...
[stdout] {"pipeName":"/var/folders/87/jdm41z_1137_p65dphdyvx1w0000gr/T/7047835c.sock"}
received named pipe information from server
attempting to connect client to server...
client has connected to server
[Info  - 3:13:15 PM] [Program] Language server initialized
[Info  - 3:13:16 PM] [LanguageServerProjectSystem] Loading /Users/rwillems/SourceCode/roslyn/Roslyn.sln...
[Error - 3:13:16 PM] [LanguageServerHost] Microsoft.CodeAnalysis.MSBuild.RemoteInvocationException: An exception of type System.InvalidOperationException was thrown: Failed to find all versions of .NET Core MSBuild. Call to hostfxr_resolve_sdk2. There may be more details in stderr.
   at Microsoft.CodeAnalysis.MSBuild.RpcClient.InvokeCoreAsync(Int32 targetObject, String methodName, List`1 parameters, Type expectedReturnType, CancellationToken cancellationToken) in /_/src/Workspaces/Core/MSBuild/Rpc/RpcClient.cs:line 163
   at Microsoft.CodeAnalysis.MSBuild.RpcClient.InvokeAsync[T](Int32 targetObject, String methodName, List`1 parameters, CancellationToken cancellationToken) in /_/src/Workspaces/Core/MSBuild/Rpc/RpcClient.cs:line 114
   at Microsoft.CodeAnalysis.LanguageServer.HostWorkspace.LanguageServerProjectSystem.OpenSolutionAsync(String solutionFilePath) in /_/src/Features/LanguageServer/Microsoft.CodeAnalysis.LanguageServer/HostWorkspace/LanguageServerProjectSystem.cs:line 110
   at Microsoft.CodeAnalysis.LanguageServer.HostWorkspace.LanguageServerProjectSystem.OpenSolutionAsync(String solutionFilePath) in /_/src/Features/LanguageServer/Microsoft.CodeAnalysis.LanguageServer/HostWorkspace/LanguageServerProjectSystem.cs:line 123
   at Microsoft.CommonLanguageServerProtocol.Framework.QueueItem`3.StartRequestAsync(TRequestContext context, IMethodHandler handler, CancellationToken cancellationToken) in /_/src/Features/LanguageServer/Microsoft.CommonLanguageServerProtocol.Framework/QueueItem.cs:line 148
Using dotnet configured on PATH

Steps to reproduce

• Clone the Roslyn GitHub repository. Run ./build.sh --restore and ./build.sh --build
• Open a Roslyn .cs file in VSCode
• Inspect the C# output channel

Expected behavior

C# extension starts successfully

Actual behavior

Code editor features such as go to definition are not working

Additional context

Add any other context about the problem here.