The military has plenty air training ranges. When they’re not in use, they work pretty much the same as normal airspace. When they’re hot, traffic is just vectored around them, under them, or over them.

Trouble with this though, due to the cost of moving stuff around up there, a space range would effectively be exclusive use.

That being said, space is vast and three dimensional. I’d have to see how big a slice they’re asking be set aside. Chances are, it’s not a lot.

Good luck getting them to say what’s happening up there, though.