The first things that come to mind:
A wider sink with storage below,
A better looking faucet that can be angled toward the center of the sink,
A lovely paint job behind the units,
A nice sconce with a flexible arm instead of the bare bulb,
A washable rug that looks good with your newly painted wall in front of the units,
Hang a canvas print that makes you happy and brightens up the mood.

Since the washer drains into the sink, I wonder if the sink drain can be rotated a bit, enough to move the sink even an inch or two to the right, and the washer move closer to the sink?

The heights really are unfortunate. You can’t raise the sink to be closer to the faucet, because the washing machine drain hose as to be no higher than it is now, I think. If you put a longer faucet for the sink, it’s still high enough that it will splash a lot. The hise on the faucet wolves that problem, and is surely convenient for rinsing off stuff since you can hold it like a sprayer, but…

I suppose the dryer is gas, so it might be an expense to move it.

Is this your garage? or basement?

I think I might just paint the wall white, you can use those big globe vanity-type bulbs for the light bulb if you don’t want to buy a new fixture,

Please replace that outlet over the sink with a GFCI!

I’m not sure you would be able to reach things on a shelf on the wall behind. What is going on in the area where you stood to take the picture? Can you put a low bookcase, to hold laundry baskets, the detergent etc? That would define the area kind of like a wall. A runner on the floor will define it further. but personally I find them a bother. They do look nice, though.

1- Stand in front of your washing machine and reach up with your hand as if you were getting something off the shelf. Mark your hand height. Do the same with your dryer. That's where a shelf would be useful. Before installing a shelf, find out where the many electrical wires are behind the wall.

2- A plumber can move your faucet.

3- As @bpath says, get a GFCI outlet. An electrician can move the outlet to a better location.

4- Use peel and stick wallpaper as a background. It's cheap, easy to apply, and comes in lots of patterns.

5- Put a washable runner in front of your washer dryer area to keep dropped things from getting dusty when they fall. Or use a 6 by 8 foot piece of sheet vinyl from a big box store's selection of ready cut pieces or from a local flooring shop's selection of remnants.

I know you said garage, but if you search ’basement laundry area makeover’, so many ideas come up that might work in your situation, too. Hopefully will provide inspiration. :)

You could have the plumbing moved so that it is centered on wherever you want to have the sink. One option would be to do a countertop across the washer and dryer with a sink integrated into the countertop in between. If it is possible, it might be even better to put the dryer on the left, then the washer, then the sink, but that's probably the most moving of plumbing and electrical.

Here are some inspiration images of having a sink between the washer and dryer. You could do a countertop across the whole space to unify it. And go with a sink in a cabinet to provide storage underneath the sink.

The most affordable option would probably be to get a pre-made sink cabinet from IKEA or a big box store. Buy an affordable single bowl deep sink and affordable faucet. See if you can get an affordable laminate or maybe butcherblock countertop. I think that would make things look a lot better to have a unified space with a nice sink cabinet instead of the free standing plastic sink.

I don't know whether you can put cabinetry around the existing panels and electrical. That would probably be a question for an electrician. I know some panels have to be exposed.

Thank you all for your suggestions! I showed this to my partner and I think it was helpful for him to see other folks perspective, especially the piece about the plumbing and outlet needing to be moved. 

I think if i move the washer next the dryer I'll have a better bet of having some kid of cabinet or shelving above it, since i can't put anything that blocks the electrical panel. Either way i know I'll have to move the plumbing around. 

Not sure if anyone knows the answer to this, but we have the water tank that is a few years past it's expiration date. If i replace this with a tankless water heater, how much space do you think will become available? Perhaps i can install a tankless water heater outside?

I posted some pictures of what that laundry area looked like with the previous homeowners and how it looked when we moved in/before we installed our washer and dryer.

Because we have a small home the garage is multipurpose - it's where we enter the house, it's where the laundry is, and of course where we should be keeping non-seasonal items.

I like the washer and dryer stacked next to the hot water, now change out the sink with some base cabinets and a deep sink and counter. It doesn’t need to be fancy. You can paint them whatever you like

Moving the plumbing will be very expensive.

If you stack the washer/dryer, you will only be able to easily turn on the hot water for the sink. (Be sure you can access the cold tap, it's just that it will be inconvenient to reach for most average days.) If you're ok with that, then I think stacking the W/D would be your best layout. Then you could put a sink cabinet to the left, with storage and a countertop to set things on. Then give the walls fresh paint, also paint anything else that can be painted -- such as the conduit, outlet covers, and the electrical box.

Ask a plumbing store for help finding better ways to extend the faucet:

If you find the water tank unsightly, you could have somebody build panels around them, like below. Just make sure they're easy to pull out or open if you need to access the tank.

Once you have a nice laundry sink cabinet and fresh paint, I think you won't be so bothered by the utility panels. But if you still hate them, you could cover them with shallow cabinets. You'll need to cut notches so they'll fit around the conduit.