I would use this activity to help students get an idea of where they actually are in regards to the bigger idea that they live in a house, on a street, in a city, in a state, in a country and so on. This is helpful for students to actually get it so that it makes sense on their level. You could also do this on a smaller scale first of the school so they get an idea before the large scale project that this is.
A great idea for teaching kids about the important place they play in their community. This helps to build a sense of identity and purpose. I would tweak it a little though so it doesn't look like they are the center of the universe