In the spirit of making lemonade, you could consider highlighting these strange shapes with paint. For instance, my first thought was to paint the back of both recessed areas black or charcoal. Then my mind turned to more color with Tansy Green (dark lime skin color) on the back of one of the recesses and Surf Green (dark blue/green) on the other. You have lots of light flooding into the room and loads of space for drama. Consider a couple of your favorite colors. You can go bold, but not TOO bright. Best to choose somewhat muddy colors.

Yes, Carolyn, we are thinking alike. The shapes remind me of a Mondrian painting. I would use bright colors depending upon your furnishings. I see blue painted antique doors(robins egg blue) on the big square space, reclaimed wood (stained or clear finish) on the rest of the fireplace and low wall. Then paint the tall space red if you're brave or charcoal. Shelves and art in the tall space. Here's a set of doors however, you could find newer ones and paint to resemble antique.

I was going to leave the FP wall white or neutral with color only in the two recessed areas. It's interesting to hear Dar's creative mind at work, jazzing up your space with those wonderful doors. Two colorful ideas, totally different from one another. We need Groveraxle on this dilemma!

I love your build in-idea and totally get you can't cut into the wall any further on the left hand side. Here are a couple thoughts for the left side. A huge mirror framed with very large moulding would reflect the light from your high windows up into your upstairs even more. You could add the stone you do on the fireplace into the back of that opening as well. Then come down the remains wall with shelves and/or cabinetry.
Another cool thing would be to go ahead and do shelves with a cool wood ladder that was attached and slid across the bottom of the wall... ( think old world library) the ladder coming down the wall with the build-ins on the other side would give you some balance. (Might be hard if you have little kiddos) you could also just Sheetrock the left up? Or even just the side closer to the catwalk to make it closer in appearance of width to the right side? You could add some lighting to the top of the opening and put a great piece of art work or family picture in whatever size you felt was more balanced to the right side. You should be able to recess in some shallow shelves in between the studs too.
I actually just made a large mirror with some great crown moulding and its posted on my blog in a bathroom I just renovated. You can see how I did it. I also have some recessed shelves I did in between studs in my bar I just built.

Hope this helps sometimes brainstorming allows you to happen Aponte your perfect solution!

Renae
www.knowtheit.com/blog

I'd drywall up the space on the fireplace. I'd also just ignore the space adjacent to the windows. Let your decor carry the day.

I could see a very large gallery wall to the left of the fireplace. Lay them out 1st on the floor to find a good arrangement. a room does not need to be symmetrical, it just needs balance. It is hard to understand this concept w/o symmetry. Just try to think of it in these terms. Check Great Big Canvas for some very large art. Will there be a TV on this wall? This could start the gallery with a low credenza under the TV.

I also like the idea of painting just the two areas of recessed walls dark colors, perhaps 2 different colors as was suggested earlier. When you have the time & the money do add the built-ins on the right side & go all the way up. The dark color can stay when you do that too.

I can also see adding a large beam-like mantle either all the way across or just part of the way. Make a drawing on paper & play with the different scenarios until your eye finds the right combination. Think 'balance', not symmetry. Good luck

I would use the large recessed area to highlight a large painting such as in this pic. This is near floor level but I think it would be even more dramatic up high. On the other side I would put a very tall tree - even just tall bare branches to give some upward movement.

Here are some dramatic branch pics

This room deserves large museum quality art/artifacts. I started with a 7' museum banner by an African artist, added a Bwa plank mask, then in the niche above, two Fon figures and a Senufo door.

Because the windows are spectacular, I purposely left the chimney breast bare, along with the space to the left of the TV. Probably ought to have a plant somewhere, maybe in place of the tall Bwa mask next to the window.

That seems like too many focal points to me...where to look first? But I'm delighted you've joined the conversation, grover, and would love to see you color those two areas in whatever colors you wish, or in some previously suggested combo. Many thanks, grover!

Dry wall it in. I see no use for it and who wants to get up there and dust.

OK, Carolyn, I'll paint in the morning. Perhaps painting the recessed areas, a tall banner above the fireplace, and a TV to the left (because you know there's gonna be a TV in this space) will be enough.

How about a statement art piece (painting or sculpture) with cabinet below.

I' sure glad you didn't fall off the ladder while doing all that painting, Grover! Many thanks for the fine work! I very much like the Tanzy and Surf version but find the art distracting. I wonder about using something sculptural but without much color, like a huge piece of driftwood or stainless steel piece?

Something similar to this driftwood art, turned vertically, could work on the FP wall, tho it would need to be just a bit larger.

Wire sculpture by Bart Soutendijk:

Looking good, Grover! Wonder what Mariah thinks of it?

Thank you for the ideas everyone. I like the large artwork suggestion and painting the recessed areas. I think I will do that until we are ready to add the stonework up the fireplace and will probably just get rid of the ledge at that point. Our house has a "lodge" feel with all earthy neutral tones, so I'm not sure about the greens, but i appreciate the visual Grover provided

Then maybe a brown and a rust?

I know you can't take the space away from the room behind on the first floor, but can you add it to the room on the second floor in terms of storage or something?

In terms of usable space, I think palimpsest nails it - if you drywall that space in, you might be able to use it for additional storage upstairs and who doesn't need more storage? Also, the pic looks much cleaner and less distracting than a lot of previously discussed options

Mariah, as you investigate what earth tones you want to use, take a look at Sherwin-Williams Armagnac (rusty orange) and Artichoke. Doesn't Groveraxle do wonderful work!

Great space for art!

This inspiration pic references many of the ideas given by Houzzers.
You could paint the recess in different tones of grey and add a long piece of fabric in the deep high niche and a console/buffet table.( the light coming thru the windows would ruin any art in this space.)
Add a large framed poster over the FP
inspiration pic for ideas
https://www.houzz.com/photos/h45-loft-industrial-living-room-portland-phvw-vp~185793

Armagnac and artichoke:

Thank you, Grover!