に and で used in relation to places

で is used to mark a location with verbs that involve action.　For example, 遊ぶ、読む、待つ

に is used to mark a location with verbs that involve existance.　いる、ある、存在する

As a rare exception, with some verbs the result is a place that became a place where you could exist, に may still be used. For example　無人島に小屋を作る。