I would put a door on it and make it into a coat closet or other storage.

You can never have enough coat closets.

Closet

Ditto the others. It looks like it’s supposed to be a closet.

Thanks all! I agree, it looks like it was a closet, which is weird as there’s a coat closet just to the right of the door. You never can have too many closets!

If you don't want to wall it in, I'd look for a chest substantial enough to take up some space and hang a beautiful painting above it. The light would really enhance a painting I think.

Coat rack.

I agree that it would work well as a storage area by adding a door.

I would put a really cool piece of art with a light to highlight it I find that nook very interesting and a lot more so than a closet door to stare at

I'm thinking like Olychick... make it a built-in even, for a entryway table for guest purses, etc. Do you have another space in the entryway for that? use the lower storage space for mittens, hats, umbrellas, etc.

It would make a good space for a key/mail drop and could would also make a great space for a wonderful painting in the upper portion.