Evidence that location search might be coming to Google
This screen shot, I think, suggests Google is planning to add the advanced search command
Below the search box Google says
location:madrid was dropped from your search because it is not support for this type of search
You'd think there would be thousands of matches for this search. Think of all the Twitter profiles that contain the bio line "Location:Madrid" or "Location: New York".
Fortunately we can put a space between "Location:" and the target city and get results. Otherwise I'd not be thanking Google for dropping such a significant part of my search query!