Friedland said dramatic increases in people using the Internet and mobile devices have created huge demand for companies that create content, sell products and provide services online – all of which play to the city’s strengths. But significant challenges – such as talent shortages, cost of living, lack of supply, infrastructure, pricing and leasing flexibility – all remain concerns for the future.

“The availability is tightening and when you combine it with infrastructure, what is tricky with these tech firms, and we certainly saw it with eBay, is they want to convey the right message with their space and have the right feel,” Friedland said. “At the same time, they need the infrastructure, and not a lot of the buildings in Midtown South are simply not big enough to house a company like an eBay on one floor. Marrying those two things can be a challenge, especially as availability tightens. That certainly effects pricing.”

At the same time, the city is actively taking a role in attracting and retaining tech businesses in the five boroughs. Under the TechStars New York program, a startup accelerator initiative, approximately 486 digital start-ups have formed in 2007 that have received funding, and currently, there are well over 1,000 web-based tech start-ups that have applied in March 2012, up from 600 applicants in 2011, according to CBRE.

In addition, the city, in partnership with the Association for a Better New York, is rolling out a series of initiatives designed to expand broadband connectivity throughout the five boroughs to get hundreds of buildings wired, permitted and certified over the next two years to handle more digital services.

Friedland added that even though Midtown South space is filling up and getting more expensive, other areas, like industrial areas of Brooklyn are emerging as options for businesses looking to establish a brand. “It is positive already, and we think New York is well-positioned for this to continue for the foreseeable future," he said.