You are right. As people get more and more invested in online activities, real world neighbors sometimes never even meet. Common geolocation tags might well facilitate real world neighbors meeting online, perhaps for the first time, and being able to touch base in the activities they are investing in, even if only online.
This is a great idea, and something the world needs.
Great comment. Being able to integrate geo-referenced content types into Steemit.City would be a great added value.
One example might be the geolocation of an area where a property owner has a requirement to convert an underutilized lot into a urban farm system(maybe assessing a proposed "container farm" system installation for example).