Some seem to have HQ as the homepage and then build internal pages for other locations.
On the other side if you only have one physical location and the other areas you want to target don't I would again put the physical location on homepage and then inner pages.
That being said I personally purely from a structure point of view taking SEO out for the moment would want generic terms on homepage and treat locations and inner locations as categories and subcategories.
But if you do this im sure rankings will be lost until you get the location ranking again on a inner page.
Haven't really given a answer but ive been looking into location specific SEO so this thread interests me.