How do I build a segment of users near a specific location?

Use the Geo filter in the segment builder. It matches users whose device is within a radius you set around a point.

Go to Audience → Segments and click Create Segment.
In Add filter by, click Geo.
Set the location and radius: use Find a place... to search, or enter latitude and longitude, then set the radius in meters in the within field. You can also adjust the area on the map.
Add more filters if needed. You can combine Geo with Tag, Event, Segment, or User ID filters.
To target a user on all their devices when one device matches, use Include all of a user's devices.
Click Save.

How the location is determined:

Coordinates sent through registerDevice.
When coordinates aren't available, the device IP address, with city-level accuracy.

To build a segment from a list of known users instead, use the User ID filter in Add filter by.