Aerospace and Defense: The Location Equation

The Aerospace & Defense industry is entering a period of sustained investment and change. Higher defense priorities, expanding production, new technologies and private capital are creating new opportunities for aerospace and defense companies, while increasing competition for the specialized talent, infrastructure and facilities needed to support growth.

For occupiers, deciding where to expand, invest or relocate is becoming more complex. Access to skilled labor, available power, specialized real estate and competitive operating costs can be just as important as proximity to established Aerospace & Defense hubs.

Cresa’s latest Aerospace & Defense report examines the factors reshaping location and portfolio decisions across the U.S. and provides a framework for evaluating markets through four critical considerations: talent, real estate, infrastructure and cost.

What’s Shaping Growth for Aerospace and Defense Companies?

Several forces are redefining the industry’s real estate needs. Defense investment continues to emphasize readiness, modernization and domestic production capacity, while supply-chain resilience is encouraging greater localization of critical suppliers. At the same time, aerospace and defense technology, including commercial space, autonomous systems, drones and AI, is creating demand for specialized R&D, testing and advanced manufacturing facilities.

Mergers and acquisitions and growing private investment are also changing portfolio requirements. As companies acquire new capabilities and emerging firms move from R&D into production, they increasingly need facilities that can accommodate engineering, testing and manufacturing while providing room to scale.

Talent Is Becoming a Location Constraint

Aerospace manufacturing employment has surpassed its pre-pandemic peak, intensifying competition for engineers, technicians and skilled production workers. But that talent is not evenly distributed.

The report analyzes U.S. markets based on the concentration, depth and cost of Aerospace & Defense-related labor, helping occupiers understand where specialized workforces are available and where labor costs may offer a relative advantage.

Real Estate Requirements Are Becoming More Specialized

Aerospace and defense companies rely on a mix of office, flex/R&D, distribution and manufacturing space, and conditions vary significantly by property type. 

While office and flex/R&D markets may offer occupiers greater negotiating leverage, suitable manufacturing facilities remain much harder to find. Security requirements, power capacity, specialized infrastructure and building specifications can significantly narrow the number of viable options beyond what headline vacancy figures suggest.

Power Is Now Part of the Location Equation

For advanced manufacturing, testing and other energy-intensive operations, power availability is becoming a critical site-selection consideration.

Growing demand from manufacturing, data centers and other large users is placing additional pressure on the electrical grid. Aerospace & Defense occupiers increasingly need to evaluate not only electricity costs, but also available capacity, reliability and speed-to-power early in the site-selection process.

Finding the Right Location for Aerospace & Defense Growth

There is no single “best” market for any industry. Established hubs offer deep ecosystems and specialized expertise, while emerging markets can provide compelling combinations of talent, real estate, infrastructure and operating cost.

The strongest location strategies evaluate all four factors together: Talent, Real Estate, Infrastructure and Cost.

Download the full Aerospace & Defense report to explore A&D industry trends, labor markets, real estate conditions and infrastructure considerations shaping the next phase of growth.