One 100,000 sqft box, 1,001 entrepreneur positions, seven revenue lines, an open door with a six-tier membership behind it, and a landlord paid by revenue share with no floor guarantee. This page reads the linked workbook for an LP: what the box earns, what it returns, what the Pressure Test and Position 08 still hold open, and how many boxes stand between the first one and a unicorn.
Download the model (Excel, 1,774 formulas)Download the Space & Capacity ModelThe box is built from A Level Alliances' own Space & Capacity Model: 100K sqft leased, 40K public, 20K mezzanine, 12K of the parking obligation as open market — 92K programmable, one third to anchors, the rest to 1,001 positions. Prices for the daily table ($130), the CPG test table ($200) and the outdoor stall ($80) are ALA's Costco/CDS-anchored bands; every other tariff is an estimate flagged as such in the workbook.
Position 08 changed two lines. The door stays open: membership sells recognition, not entry, so line 07 is Master at $15–25 (a traffic instrument priced for conversion, the Council's one undeferrable decision), Emeritus at half of Master and never free, Stage Access creators at full Master plus commission, and Corporate seats sold on willingness to pay. Trader and Digital-Twin memberships are included in position and twin fees and are deliberately not revenue lines. The Arcade is now a per-member fee of $110–150 with Master included, anchored to the national coworking median of $225 rather than to Industrious — and being capacity-capped at 51 desks and 36 micro-rooms it earns under half a million dollars, which is the honest number.
In the realistic case the box reaches $16.4M gross revenue and $7.3M venue NOI (45% margin) at run-rate, pays the landlord 25% of NOI — 1.5× what a Class B/C shell would earn on a lease — and leaves $4.7M of OpCo EBITDA before the 40/40/20 split. On $6.2M of CapEx that is a 35% IRR with no exit and 49% with an operator-multiple exit in year seven.
The pessimistic case is not a soft version of the same story. It stacks the open challenges of the Pressure Test — thin table demand, a sponsor royalty on gross with no cap, a landlord taking 30% — and the OpCo never turns cash-positive. It is the case the Legal Ally must design the documents against.
Seven lines, one floor. Line 02 is the Arcade's member fees (desks rotated 2–3 members each, micro-rooms shared) plus studio and bench bookings; line 07 is the four paying tiers of Position 08 — Master, Emeritus, Stage Access, Corporate. Guest is free and registered; Trader and Digital Twin ride on their position fees. Landlord and OpCo lines sit below venue NOI. Columns are the three scenarios; every number links to the workbook.
| Line | Pessimistic | Realistic | Optimistic |
|---|---|---|---|
| 01 Open Market & Market Hall | $3.5M | $7.4M | $10.1M |
| 02 Enterprise Arcade (tier 02 fees + studios, benches) | $109K | $213K | $335K |
| 03 The Stage | $333K | $1.3M | $3.3M |
| 04 Live Commerce Center | $753K | $2.4M | $5.3M |
| 05 Back of House | $302K | $635K | $1.0M |
| 06 Media — PingPod | $400K | $800K | $1.1M |
| 07 Membership — Master, Emeritus, Stage Access, Corporate | $879K | $2.6M | $6.1M |
| Anchors — 8 brands + 6 street-food | $600K | $833K | $1.1M |
| Gross revenue | $7.0M | $16.4M | $28.7M |
| Gross revenue per sqft GLA | $70 | $164 | $287 |
| Non-dues revenue ÷ membership dues (Position 08 target 1.5–3.0×) | 7.4× | 5.9× | 4.1× |
| Cost of delivery | ($2.6M) | ($5.7M) | ($9.0M) |
| Building opex | ($840K) | ($780K) | ($660K) |
| Other fixed opex | ($1.6M) | ($1.4M) | ($1.1M) |
| Marketing / demand engine | ($558K) | ($985K) | ($1.4M) |
| Sponsor royalty | ($698K) | ($222K) | $0 |
| Venue NOI | $674K | $7.3M | $16.6M |
| NOI margin | 10% | 45% | 58% |
| Landlord revenue share (30% / 25% / 20% of NOI, no floor) | ($202K) | ($1.8M) | ($3.3M) |
| Landlord income vs Class B/C lease alternative | 0.2× | 1.5× | 2.2× |
| OpCo overhead / G&A | ($1.0M) | ($850K) | ($750K) |
| OpCo EBITDA (pre-tax, pre 40/40/20) | ($528K) | $4.7M | $12.5M |
Project level, unlevered, pre-tax, seven-year horizon, 15% discount rate. "No exit" is the pure operating case and the one the proof-of-concept should be judged on; "with exit" applies an operator multiple (5× / 7× / 9×) to year-7 cash EBITDA, the CBRE–Industrious precedent.
| Measure | Pessimistic | Realistic | Optimistic |
|---|---|---|---|
| Initial CapEx (Y0) | ($8.5M) | ($6.2M) | ($5.1M) |
| IRR — 7 years, no exit | n/a (never recovers) | 35% | 142% |
| IRR — with exit at Y7 | n/a | 49% | 147% |
| NPV @ 15% — no exit | ($14.7M) | $5.9M | $37.4M |
| NPV @ 15% — with exit | ($16.0M) | $18.4M | $83.3M |
| ROI, 7-year cumulative cash ÷ CapEx — no exit | -108% | 371% | 1497% |
| ROI incl. exit (MOIC − 1) | -150% | 903% | 3889% |
| Payback year (no exit) | beyond Y7 | Y4 | Y1 |
The Pressure Test (pressure-test.fifthwallpe.com, Appendix I) listed the challenges an LP's own diligence would raise and the answers proposed. This is where each one stands inside the model.
| Item | What the Pressure Test raised | Where it stands in the model | Status |
|---|---|---|---|
| C2 / C18 | Table demand is untested; challenges compound when stacked | Optimistic uses ALA's 55% occupancy; realistic haircuts to 40%, pessimistic to 25% and stacks every other open item | open — first box decides |
| C8 | No second box before four quarters of data | Rollout schedules open one box in year 1 and one to three in year 2 in every scenario | encoded |
| C11 / 5-C | 12,000 Arcade members exceed the physical ceiling | Arcade rebuilt from 12 studios, 36 micro-rooms, 51 desks, 25 benches — 124 positions at 60–90% occupancy | closed |
| C12 / P08 §11 | Guest → Master conversion is the single most sensitive input; 2% of visits unproven | 1.2% / 1.5% / 2.0% of 0.5–1.0M visits, tenured renewal 75–90% against the ≥85% target; the 90-day activation window and registered Guest tier are what make the number measurable | open — set explicitly, review monthly |
| P08 §09 | Master monthly price not set — everything else derives from it | Modelled at $15 / $20 / $25, the Council's indicative band; Emeritus at 50% of Master funded by Trader and Corporate pools, state support removed | Council decision |
| P08 §09 | Arcade anchor: coworking market median $225, not a named competitor | Arcade fee $110 / $130 / $150 with Master included, capacity-capped at 51 desks and 36 micro-rooms; treated as a floor, not a target | encoded |
| P08 §06 | Trader membership is not a revenue line — a CFO finds it in the first meeting | Trader and Digital-Twin tiers carried as register entries only; no membership revenue booked on the 1,001 positions or 1,001 lockers | encoded |
| P08 §08 / §10 | Creators: no discounted tier; camera zoning; liability of Emeritus counsel; pause not cancel | Stage Access at full Master plus commission (line 03); the four red lines are drafting items for the Legal Ally and carry no P&L entry | Legal Ally |
| C13 | Missing cost lines: insurance, tax share, security, tech amortisation, floor staff | Added as fixed opex ($1.1–1.6M) and a heavier building-opex rate; table cost of delivery lifted to 40% | closed |
| 5-A | Marketing and Stage programming need a budget line | 5–8% of gross | closed |
| 5-E | A 10% sponsor royalty on gross recreates Simon's free anchor space | Realistic: 10% of net media + membership, capped at $600K. Pessimistic keeps it on gross, uncapped — and that is what kills the OpCo | kill threshold |
| 5-I | Replace $/sqft lines with an area-based model | Every line is positions × price × occupancy × days, on the Space & Capacity Model's own counts and areas | closed |
| 5-J | Proof-of-concept as a single LLC, no PEIT/TRS layer | Model is single-entity, pre-tax; landlord paid by revenue share, not equity in a PropCo | encoded |
| 5-L | Four systems scoped to the proof-of-concept | Integration CapEx $0.55–0.9M; digital-twin lockers carried at 1,001 units | encoded |
| Landlord floor | landlord-math left the floor guarantee blank | Removed by instruction on 2 Sep 2026; pure revenue share at 20–30% of NOI, benchmarked against a $10–15 lease alternative | decision |
| 7.3 | Keep the 50-location narrative outside the proof-of-concept | Rollout is a separate sheet and a separate section here, labelled long-range scenario | encoded |
Each location is a copy of the box above, opened on the schedule below and ramped on the same curve, with shared services and a platform G&A in place of the single-box overhead. Site selection follows the Location Framework in the Space & Capacity Model: Trader Joe's county footprint (661 stores, 42 states), Gen Z share, the conscious-consumer cluster, nonemployer-business density and Class B/C box stock; Track B scores the eight states without a Trader Joe's on the remaining criteria.
| Measure | Pessimistic 1·1·3·5·10 boxes / yr | Realistic 1·2·7·15·25 | Optimistic 1·3·11·25·60 |
|---|---|---|---|
| Locations open at Y5 | 20 | 50 | 100 |
| Y5 portfolio gross revenue | $64.5M | $469.5M | $1.85B |
| Y5 portfolio EBITDA | ($14.6M) | $123.5M | $800.5M |
| Y5 EBITDA margin | -23% | 26% | 43% |
| Y5 EV on actual-year EBITDA × multiple | $0 | $864.3M | $7.20B |
| Y5 EV on stabilized run-rate × multiple | $0 | $1.69B | $11.45B |
| Y5 EV floor (Industrious $4M per unit) | $80.0M | $200.0M | $400.0M |
| Peak equity funding need | $430.8M | $103.6M | $4.2M |
| Cumulative cash at Y7 | ($430.8M) | $125.5M | $3.84B |
| Boxes needed for $1B EV | never on EBITDA | 30 | 10 |
| Boxes needed for $10B EV | never on EBITDA | 293 | 88 |
| First year stabilized EV ≥ $1B | not by Y7 | Y5 | Y3 |
| First year stabilized EV ≥ $10B | not by Y7 | not by Y7 | Y5 |
Illustrative allocation of the realistic 50 and optimistic 100 boxes across the first-pass metro pool. Circle area is the number of boxes; the first 30 in the realistic sequence — the unicorn threshold — are drawn in green. Track B metros appear only in the optimistic allocation.