Letting modders change textures based on the target's in-game location is a common request.

Adding a Location condition is a common request, but it adds some new complications:

• We can't calculate it once (e.g. on day start); it would need to constantly recheck patch conditions in case a target changed location (particularly NPCs).
• We'll need an internal list of all the things that can be location-specific (e.g. NPCs and constructable buildings, but not tilesheets) and track entities of those types.
• There isn't a predefined list of location names (due to custom locations), so the validation logic will need to be revisited.

Done in the upcoming Content Patcher 1.8 via #417.