Classroom labs can create lab VMs within an IP address range you specify when creating your lab account in the Azure portal. When an address range is provided, each lab that's created after it's allotted 512 IP addresses for lab VMs. The address range for the lab account must be large enough to accommodate all the labs you intend to create under the lab account.
For example, if you have a block of /19 - 10.0.0.0/19, this address range accommodates 8192 IP addresses and 16 labs(8192/512 = 16 labs). In this case, lab creation fails on 17th lab creation.
Hope this information helps.