Despite the decision to move U.S. Space Command out of Colorado Springs, local commercial real estate leaders are confident that the defense and aerospace industries will continue to grow in the area.

Development of government and secure facilities and defense coworking space has taken off in Colorado Springs, and demand remains high, even with Space Command relocating to Huntsville, Alabama, Bryan Construction Vice President of Project Development Doug Woody said.

“Contrary to popular belief, that’s not going anywhere, even with the Space Command decision,” Woody said during Bisnow’s 2026 State of Colorado Springs event Feb. 26 at the Meanwhile Block event venue.

While Space Command moving “sucks,” according to Woody, the Colorado Springs Chamber and Economic Development Corp. is already working to create partnerships with other cities.

“This ecosystem of defense and aerospace is so interwoven and important to our future as a nation that we have to be able to partner with Huntsville, for example, or Dayton, Ohio,” he said. “We’ve got to extend those olive branches, because there is so much opportunity, and it’s not going away.”

Nooks, a company that creates classified workspaces, sees Colorado Springs as a leader in pioneering multitenant secured classified information facilities. The city’s advantages include its defense industrial base and open space environment, said Sean Ferguson, who works in partnerships for Nooks.

“We believe the full corridor from here in the Springs all the way up to Denver is going to be a strong defense corridor going forward,” Ferguson said. “There’s a lot of things that are very difficult to replicate, and so I think the advantages will sustain over time.”

The aerospace and defense industries have a history in the Colorado Springs area that long predates Space Command. They have been drivers of the industrial market in particular.

A 2025 market insight report on Colorado Springs from Matthews found that sales volume in the industrial and flex markets increased almost 51% from 2024, and the average vacancy rate for buildings between 5K SF and 200K SF remained consistent at 5.2%, below Denver’s rate of 8.6%. Total construction starts ended around 494K SF last year.

A new destination for industrial projects in the city is the Peak Innovation Park, a master-planned business park anchored by Amazon and developed by Urban Frontier. In December, Swire Coca-Cola announced it would construct a 620K SF plant at the park, and Minneapolis-based Opus shared plans for a 252K SF industrial project targeting defense and aerospace tenants.

Colorado Springs is primed to capitalize on the predicted growth in the defense and aerospace industries, said Garrett Baum, managing partner at Urban Frontier. He said there is demand for almost 1M SF of office space to support the military community in the city.

A key factor in the city’s ability to attract the defense and aerospace industries is its educated and specialized workforce, thanks to military retirees. Baum said the labor force, combined with pro-business politics, will set the city up for success.

“That’s an advantage Colorado Springs has over a lot of other cities, including Denver,” he said.

Baum and Woody advocated for additional affordable housing to support the growth.

In addition to housing, Colorado Springs is seen as a place with strong relative value, and the growth of these industries is a big draw for retail, said Matt Call, founder and principal at NavPoint Real Estate Group.

“When we’re talking to developer clients about potential opportunities, the aggregation of defense and aerospace down here and the associated incomes and jobs that they provide creates an opportunity for retail development,” Call said.