Looks like it was meant to be a door to the exterior that got converted to a window instead during the build. Would a door there be useful to you? Tearing down a wall could be a possibility, but you need to determine if that wall is load bearing first. That means you need a structural engineer's report. Just have him do that at the same time he's engineering the new supports for your new second floor bedroom above the kitchen. You'll need that stamped for the permits anyway, so kill two birds with one stone.

Ignore the spam, urgh. I would absolutely annex it and make it part of the laundry room!!!!

I did have one other thought, do you need a little half bath? Sure looks like a good potty niche!

Dog crate!!!

I like the laundry room idea. Could you make the entrance right in front of that window, so you could leave the door open and take advantage of the light?

-no dog
-there IS a powder room, just before the laundry room on the left!

yes, I want to make the doorway right across from the window...perhaps pocket door so it isn't in the way? We have a regular door on the existing laundry room and it is always in the way when you have a basket in your arms! We only close it when we have company, so I think a pocket door that stays open for light would work well.

thanks for all the help!