Device-to-device (D2D) communication is envisioned to improve spectrum utilization and user experience in cellular networks. This paper addresses the problem of mode selection and resource allocation for D2D links underlying 5G networks. We propose a location-aware graph-based approach that exploits proximity and spatial interactions between D2D and cellular users. The problem is formulated as a network utility maximization framework with resource constraints. An efficient algorithm is developed to determine mode selection, power control, and channel allocation based on user locations. We demonstrate through system simulations that our proposed scheme provides significant performance gains over conventional partial channel knowledge-based schemes.