This threw me off originally because I installed Android Studio and didn't realize that this was incorrect. app extension and isn't treated like a folder and therefore disabled in Unity's Android SDK location dialog.
This is problematic when you have Android Studio installed because the folder uses a. The location of the Android SDK can also be changed in the editor by selecting Unity > Preferences from the menu and then clicking on External Tools in the preferences window.
The first time you build a project for Android (or if Unity later fails to locate the SDK) you will be asked to locate the folder where you installed the Android SDK (you should select the root folder of the SDK installation).