I like the idea I've been bating on about something similar for a while. I think its do able. It would be hard for the cities, easy for the castles and towns.
Maybe one upgrade could be a gaurd tower in the center of town.
For the castles I think the easiest thing to do would be to have set types of castle with 3 different level of upgrade 1, 2, 3 like in Shogun 2.
Perhaps the upgrades to cities could be economic ones that improve production. Like one upgrade that increase the % chance of succefully producing, one that increase the production rate and one that increase the discount.
Maybe an upgrade for the castle could be an armoury that supplies all your clans forces in an AOE with an amount of weapons and armour while they are near the castle.
Seems like an interesting idea. On the same wavelength as that, I've slowly been fleshing out a similar idea in my mind having to do with Bandit Hideouts, either as an AI presence on the map (that would hire human players, it wouldn't be bots fighting) that would waylay caravans or what have you, or as a safe haven for bandit scum roleplayers to store their booty, located in woods all over the map.
A while ago I had the same idea but I was think that clans could build them and members of the clan could see it and the only way for others to see it would be to walk right up to it.
It just acts like a normal fief but you can't recruit or craft in it.
Maybe you could "fense" stuff through it? As in sell your loot at it at some fixed thing, like 10 gold + distance bonus.