Like other social animals and biological systems, human groups constantly exchange information. Network models provide a way of quantifying this process by representing the pathways of information propagation between individuals. Existing approaches to studying these networks largely hypothesize network formation to be a result of cognitive biases and choices about who to connect to. Observational data suggests, however, that physical proximity plays a major role in shaping the formation of communication networks in human groups. Here we report results from a series of agent-based simulations in which agents move around at random in a bounded 2D space and connect while within communication range. Comparing the results to a non-spatial model, we show how including spatial constraints impacts our predictions of network structure: ranged networks are more clustered, with slightly higher degree, higher average shortest path length, a lower number of connected components and a higher small-world index. We find two important drivers of network structure in range-constrained dynamic networks: communication range relative to environment size, and population density. These results show that neglecting spatial constraints in models of network formation makes a difference for predicted network structures. Our simulation model quantifies this part of the process of network formation, realized by simply situating individuals in an environment. The model also provides a tool to include spatial constraints in other models of human communication, as well as dynamic models of network formation more generally.