I feel for you- our bedrooms are somewhat odd in that they can only be arranged in certain ways, due to doors, windows, etc. It almost feels like the room dictates what you have to do with it :( I've made a point of just working with the most practical layout. How much "closet stuff" do you have? Clothes and other items that you would want to store in an enclosure. I have to agree with annkh_nd that you would just be moving the storage around with the bed in the closet. It also looks like by moving the bed into the closet you lose your nightstands? Could you put a dresser or other chest of drawers in one side of the closet? Then hang short stuff over the drawer unit in the closet, longer stuff on the other side? How about a small storage unit of some kind on either side of the door off the foot of the bed? Would you have enough room at the foot of the bed if you were to put other pieces there? How about storage under the bed? Either in a platform that has drawers/cabinets in it, or in the form of under bed boxes? When DH and I lived in a small rental unit, we ended up putting our full sized bed against one of the walls. I didn't mind sleeping between DH and the wall, and generally got up after he did at that time. If I got up earlier, I would just go off the foot of the bed. Personally, I'd prefer the bed against the wall, to only having a narrow foot or so on the side that felt like a chasm.

Visit any Habitat for Humanity Restore Store and/or any "antique" -- used furniture store -- or charity sponsored thrift store that is large enough to sell donated furniture and you're likely to find one or more of those cabinets (tall and deep) that were used for large analog tvs -- until someone upgraded to the thinner digital tvs. Quality and supply of donated cabinets varies so it could take multiple trips to find a really good one you'd want in your home but do see if you can because, in addition to being easier on the budget than new furniture, you might find it useful for storage even if you don't choose to create a toy kitchen for the little one: https://www.pinterest.com/pin/521925044290872951/ https://www.pinterest.com/pin/AS5jzll5LQUFkFFlZEv9oGvR8UOFnLFzAyBvF5hZreJmcNbFLfcGVMw/ https://www.pinterest.com/pin/240238961342141195/ Some DIY work on used cabinets such as to close any cord holes in the back and/or add shelves or doors, could enable you to repurpose one to become much needed toy storage now and, depending upon what it looked like before and/or what you create, perhaps a linen cabinet later -- and do so on a modest budget. In a small space, "go tall when you can secure cabinets to the wall" (for safety w/toddler in the house) in order to maximize storage with minimum floor space used. If you could create floor to ceiling and nearly wall to wall edge shelves and/or cabinets (or cubes of a suitable size for baskets or creates you choose), the storage space that your daughter could reach could be hers and the storage/display space above that would be yours. It would be a plus if you could set your tv on a center shelf to have it out of reach of a toddler but at a comfortable height for viewing. If you don't limit you shelving to the blue wall but, instead, turn the corner and continue the shelves/cabinets along the side wall (for whatever width you choose for the play space), you could use that shelving/cabinetry on the side wall to hide any wires/cables you might want/need attached to both your computer and your tv. You'd want to leave several feet of play space in between whatever furniture you place next -- which, I suppose, could be your sofa for watching tv. Alternately, you might choose to use a long credenza styled cabinet and/or file cabinet to use as a room divider between the play area and your adjacent home office area. Everything between the home office area and the front wall would be your living/dining area.

I would break that room into 3 spaces. But first just a few general comments on how it is now .... Pull the area rug that is in front of the fireplace further underneath the couch so that the front legs of the couch are sitting on it. And then don't put two couches facing the same direction. The one in front of the fireplace has to stay that direction, so if you have to use the other couch then have it face the window creating a walkway into the room along it's back. 1st space closest to the front door and staircase: I would put a sideboard type piece of furniture in front of the window with two lamps on it and one accent chair closest to the door. 2nd space: Leave your sectional there with the TV. 3rd space: I would either do 4 chairs in a circle with a round coffee table in the middle, or I would put a chaise lounge there with a small table, or again if the second couch has to stay there, then I would add two smaller chairs with a coffee table if there is room, and if not then a small table between the chairs.

oh, ok. perfect. if there is room there, it would work. you'll have plenty of room for a rug, and a nice bench at the foot of the bed. maybe a few chairs, potted plants over by the window. The tall wall is also a perfect spot for some type of accenting this would be cute in the inset area: I'd do something like this. the blacks/whites/charcoal/leather tones, walnut, would all look nice w/the flooring. love the rug/bench too Inside the large niche, think about doing a built in piece with shelving,, or find a console to span that length. All sorts of ideas for the inset! If you did a built in dresser there, you wouldn't need another piece. tv goes on a swivel mount I'd really make a point of doing somethign special w/the inset spot. you could find a vintage credenza and use that, if there is room on the side, do some cubbies or something like this