Colonia (and the surrounding systems) have over time become a 'second bubble' of civilization. Back when it first started, there was almost nothing out there, just one station (Jaques) and then bit by bit it grew. There were some Community Goals that built other stations, and eventually some outpost stations along the route from the main bubble to Colonia.
Nowadays, it's similar to the main bubble where we all start, only with less stuff -- less stations, less population, no superpowers, fewer factions -- but it's still a viable place to get missions and stuff. There are some engineers out there now, even, although they aren't all up to grade 5 abilities yet (they get better as more people use them).
So it's a bit like a frontier atmosphere, and it makes a good place to call home when you want to do a lot of exploring, or just get away from the crowd a bit.
I'm not staying in Colonia now though, because I have my carrier as my main base of operations. Colonia is about 21000LY from Sol, and I'm about 1000LY from Colonia (at the moment).
I made my first trip out to Colonia some years back, in a T6 with 35LY range or so. This was before current engineering was available, or FSD boosters, so 35 was actually pretty good. I spent a few days traveling out there, exploring as I went, and I had a lot of fun. It was a good introduction to long-range travel and exploration of empty areas.