Put simply, Washington didn't want to see the development of political parties in America, as he associated them with factionalism and division. Americans from all walks of life and from many different states had come together to defeat the British in the Revolutionary War, and Washington understandably wanted to see...
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that spirit of unity carried over into post-war domestic politics. Hence his dire warnings against what he saw as the dangers of a party spirit taking root in American public life, which could potentially lead to conflict later on.
In particular, Washington was concerned to avoid the founding of political parties on geographical lines. With remarkable prescience, he saw the enormous damage that such a system could do to the delicate balance within the new nation between North and South. Nevertheless, Washington was realistic enough to know that party spirit could not be repressed entirely, as it was "inseparable from our nature, having its root in the strongest passions of the human mind." Instead, he proposed maintaining vigilance over the system of checks and balances to ensure that no one party or geographical area would gain a dominant position in the governance of the country, thus undermining the core principles of republican government.
Washington feared that the "spirit of party" and sectionalism would destroy the government he had helped create. He was opposed, in short to what we would call today "special interest groups," who placed their own interests over the interests of the nation as a whole. They opened the door for foreign influence and corruption. In particular, he was concerned about the politicians who were beginning to identify with Alexander Hamilton on the one hand and especially Thomas Jefferson on the other. But Washington's address, which was published in newspapers around the country, did not prescribe specific political solutions, or even alternatives, to this problem. Rather he appealed to the republican virtue of his countrymen, who he hoped would set partisan bickering aside and focus on the business of the nation.