here's our dry bar. it connects the kitchen to formal dining room. this pic was taken before the outlet covers and wine glass holder were attached! the cabinets below have pullouts that hold all the alcohol and mixers. uppers hold all of our glassware and crystal. beverage fridge is a Kitchenaid. opposite the bar is our large walk-in pantry.

Thank you all for the additional insight. I do not have a floor plan yet, but I can try to draw one out and see what I can do about finding somewhere to host the images. Any suggestions on free software that I could use to draw out a layout? Otherwise maybe I can use graph paper and take a digital picture. The wet bar room is literally just across the small laundry room from a powder room (which is a much larger space than this teeny tiny room). So you're probably right that a hand washing sink really won't add much of anything. I could see the sink being useful when we do remodel the kitchen (as a temporary kitchen), though it would require that area to be finished prior to the kitchen remodel. I think I'd want the cabinetry to match, so I'll have to plan accordingly. I've also been considering having a plumber look at adding a sink off of this same plumbing stack in the garage (for working on cars, gardening, painting, etc). The little room and sink back directly onto a bump out section of the garage. Maybe it would make sense to get rid of the inside sink and just have the sink in the garage. (I need to find out if this is possible since we do have to worry about pipes freezing in Utah.) If I do close off the space, I'm not certain whether I can fit a sink and a pantry in the enclosed space. It's fairly narrow, so it might be difficult. I'll have to post a layout for your review to get some help with that. I'm actually not even certain if I can comfortably fit cabinetry across what's now the bar (if I go standard 24" deep cabinets to fit a wine or beverage fridge) without visually negatively impacting our family room. I think all in all I like the idea of somewhere to keep barware, wine, maybe some beer (so it's not all outside in our garage). I have quite a few beer, champagne, and shot glasses that I really love, though we rarely use them. It might be nice to have some glass display cabinets to show them off. And I think the practicality of an actual pantry (yay!) would be very high on my list. In terms of resale, I think you're absolutely right plllog. It's a house with 3 bedrooms (maybe 4 depending on how we finish the basement) and a nice yard. Considering the region (Utah) and the neighborhood (suburban, fairly upscale with great schools) I suspect swapping out the wine fridge for a beverage fridge will be a must. The cabinetry probably would still be desired since it could easily be a place for kids to grab drinks and such. For us, we do not have children or any intention of having children. I'm honestly not certain when we might sell. This is our first house (we've lived here for 5 years) and I really hope to some day move somewhere with a bigger yard that's hopefully at the base of our spectacular mountains. (We live about a 5 minute drive away, but want to be closer.) I would hope we might be able to upgrade within 5-10 years. However, life happens and my significant other is changing his profession so that impacts our financial plans for the near future.

For all the wet bar proponents: OP says: We are purchasing a house that has a non functioning wet bar... I have no desire to have a wet bar. It is a dry bar. The alcove doesn't back up to a room with proven plumbing. The cabinet looks all the world like a bathroom vanity & mirror that got plunked down there...perhaps relocated from a bathroom that got remodeled. Note the gap between the cabinet and the wall---that indicates to me that this was not an original installation. Possibly a built-in desk was removed to make for a wet-bar wishful think? Making this area into a wet bar could potentially cost thousands of dollars to route water, drain, vent lines (if this house is on a slab.) And then equip it with refrigeration & an ice maker. OP doesn't want a wet bar. She wants ideas for how to use the space for anything but. Plus, there is white carpet on the floor. It backs up to a small closet in another room. Is that closet the same dimensions as the alcove? Does that closet jut out into the room? If it does jut out into the room (looks like it almost has to) would it be beneficial to gain floor space in that room? What is the other room? Office, bedroom? Could you post some photos of the other side or a rough floor plan sketch? Any desires? Like a place for freezer, etc?

Thanks both! We don't want to replace all of the carpet - we live in a cold climate and our basement is already chilly (hence the fireplace). Not to mention this is cheaper! I should've done a poll - so far 1:1. We are also only doing one wall in the paneling so the rest will still be light - drift of mist. Our carpet is also light. Going for a theater space kind of look on this wall. I got my way in the rest of the house (light and bright) so I'm giving in a bit to DH in this space.