Location Math

Year-5 run rate

Rev.05 scenario

Location Ally — share of gross receipts — —

Lease — net of re-tenanting — —

Share as a share of asking rent — The test a landlord runs in its head

—

Five-year forecast

Location Ally — share of gross receipts in the base Lease — contract rent net of re-tenanting

Year	1	2	3	4	5	5-yr total

Ramp applies to every revenue line equally. Building opex runs at full rate from year 1. Re-tenanting cost is amortised straight-line over the lease term.

Year-5 operating statement

Line	In the base	Gross receipts	Cost of delivery	Location share

The Location share comes off gross receipts, before cost of delivery and before building opex — a percentage of receipts, never of profit or NOI. That is what keeps it qualifying rent for a Location that is a REIT or sits under one. PropCo's own tenant revenue — grocery anchor rent, shop-in-shop corners, street food, charging host share — is the Location's own income and is not in this base.

The inputs

The box

Box, sq ft

Building opex, $/sq ft/month

Location Ally rate, % of gross

Phygital-Ready shell delivered to spec, on time

If not: points off the rate, year 1

Scope schedule — what sits in the base

Threshold rights granted
Puts commissions and threshold receipts in the base

Corridor and common-area footprint granted
Puts media and membership receipts in the base

Category exclusivity for the seed sponsor
Puts sponsorship receipts in the base

The rate never changes between locations. The base does.

Revenue lines — year-5 run rate

Line$/sq ft/yrCost %

Membership is driven by traffic rather than area, and is computed from the figures below. Line values are Rev.05 Year-5 figures divided by the box area.

Membership

Annual visits, per sq ft

Visits converting to members, %

Retention applied, %

Master tier, $/month

Other membership, $/sq ft/yr

Traffic scales with the box by default — a box of half the area draws half the visits and carries half the positions. Where a smaller box sits in a stronger catchment, raise visits per sq ft rather than the line rates. Other membership covers Emeritus, Stage Access, corporate seats, Digital Landlord PaaS and add-ons.

Lease comparison

Asking rent, $/sq ft NNN

Yearly escalation, %

Vacancy over term, %

Re-tenanting cost, $/sq ft

Lease term, years

Ramp — % of year-5 revenue reached

Year 1

Year 2

Year 3

Year 4

Year 5

What the Location gives, and what it gets

Gives: the box, the corridor footprint, the threshold, lender consent, co-tenancy recognition, municipal standing. No cash capex, no operations, no media sales, no technology risk.
Gets: a share of gross receipts from the first dollar, with no minimum and no ceiling — plus the carry it stops paying on an unlit shell, the co-tenancy leakage it stops taking on the inline roll, and the halo on inline renewals. Those three run whatever the venue earns and are not in this model.
Keeps: ownership of the ground. The improved, powered shell reverts at the end of term.
Does not get: equity in Atmosphere, a board seat, an observer, or a guaranteed sum of any kind.

The structure follows the CBRE / Industrious precedent of January 2025: an operator paid for running space it does not own, under partnership agreements with owners rather than leases. It is cited for the structure, not for the price.