Very pretty space!

How often are you using the lounge chairs? Could they be moved to the upper deck perhaps?

As I see it that is the only spot for the fire pit, and some smaller chairs to put around it, perhaps the stacking kind that can be stored under the steps when not in use.

I think the square shapes take up too much room and the furniture would be more open if it had rounded backs or was less solid in appearance.

IMO we need an actual floor plan to scale. What I notice now is too much conversatioal seating not connected to each other and no dining space . As for a fire pit get a gas oe in a coffee table type then there is no big issue since most cities do not encourage real wood fire pits . Ialso would like to see how this space relates to the one above . I do agree the ;oungers do not belong in this space. I think of outdoor space to really mimic indoor so a DR, a LR and a “kitchen” and those spaces should be done for how you use the space like the grill near the DR but also near the indoor kitchen.

Lovely patio! It looks like you already have a grill. I would swap the position of the grill with hose container, I realize the faucet is there but it must be awkward to drag the hose around the bbq. And you need a table, it’s so much more gracious for entertaining. You could put the table under the deck and hang some lighting, either strings or chandelier. Move the big chairs out to put around a fire table for cool evenings. I agree, about using the lounges elsewhere.