Building sits or building stands?

"Sits" is more passive than "stands".

Sit 9a: to have a location
Sit 10: to remain inactive or quiescent

Stand 2a: to take up or maintain a specified position or posture
Stand 2b: to maintain one's position
Stand 8b: to occupy a place or location

— Merriam, Webster's New Collegiate Dictionary, 1975

In the context of a building, "sits" simply implies located on, while "stands" indicates something that is permanent and immovable.

Saying "sits" emphasizes the location, while "stands" emphasizes the building.

E.g. "The cottage sits on the wooded shore of a pristine lake." vs. "The gleaming Buddhist monastery stands on the mountain top."

I think that in your sentence, it is the location that is more important, so I'd use "sits".