Creating a local disk VMFS manually:
If the VMFS creation on the local disk fails through the GUI, we can create it via command line as a workaround.
Type : fdisk /dev/sda
Type n for new partition :
Select [Enter] for cylinder questions until you receive a success message.
Type t for partition type :
Enter in the last number for the partition.
Enter in fb for the partition type.
Type w to write the new configuration.
Type reboot to restart the ESX Host.
Once the server has restarted, putty back in.
vmkfstools -C vmfs3 /vmfs/devices/disks/vmhba0:0:0:#"
Where # is will be the number you used for the partition. (typically the last number)
You may now go to the GUI to rename you VMFS.