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Probably a lot of sources, depends how well connected you are.

The biggest one is just routing information and rDNS hosts which give away a lot of the information required anyway. If you were really thrifty you would make agreements with services (or use services you run yourself) that have users supply their location information and use that to construct a more granular database. I suspect this already happens to a degree, some of the fake information I give out has ended up in at least one IP address database.

I strongly considered doing this at one point but lacked the connections to pull it off properly (not enough sources of data I could get without approaching random people, basically). A secondary concept would just be to crowd source it and have the information freely available, but I was never sure how to deal with people poisoning the database or just honestly supplying conflicting information.