I think your problem is due the space in the environment variable's contents. Looking at the examples from the systemd docs, an assignment should be a single string:
Example:
Environment="ONE=one" 'TWO=two two'
ExecStart=/bin/echo $ONE $TWO ${TWO}
This will execute /bin/echo with four arguments: one, two, two,
and two two.
Example:
Environment=ONE='one' "TWO='two two' too" THREE=
ExecStart=/bin/echo ${ONE} ${TWO} ${THREE}
ExecStart=/bin/echo $ONE $TWO $THREE
This results in echo being called twice, the first time with arguments
'one', 'two two' too, one, two two, too.
I tested this with the following service (note the quotes around the entire assignment):
[Unit]
Description=My Daemon
[Service]
Environment='CATALINA_OPTS=-Dappserver.home=/var/lib/archiva/apache-tomcat-current -Dappserver.base=/var/lib/archiva/apache-tomcat-current'
ExecStart=/bin/echo ${CATALINA_OPTS}
[Install]
WantedBy=multi-user.target
And got the desired output in journalctl:
Apr 26 08:19:29 laptop echo[28439]: -Dappserver.home=/var/lib/archiva/apache-tomcat-current -Dappserver.base=/var/lib/archiva/apache-tomcat-current
Of course, it would be simpler to use EnvironmentFile instead. Replacing the Environment with the following gave the same desired result:
EnvironmentFile=/tmp/foo
Where /tmp/foo contained (note the lack of quotes):
CATALINA_OPTS=-Dappserver.home=/var/lib/archiva/apache-tomcat-current -Dappserver.base=/var/lib/archiva/apache-tomcat-current
