Castle is the place that you must either defend or destroy. Sometimes when all forces in the castle are defeated the castle might be claimed as the players own. This is "Cede Castle" event cannot be put to normal maps.
Usually castle has a barracks and armoury. Keep is also situated there usually in the best protected place. Sometimes Civilian buildings are outside the castle and military buildings inside the castle. This will make more room for military buildings but can easily devastate economy because enemy propably hits strikes to the civilian buildings outside.