Do you need closed storage? You could put doors on it.

I be tempted to use shelves and fill with books and a few curated pieces of decor - or put cabinet doors on it to close it off completely (you could also use glass doors for a lighter look). I would have some sort of bottom base built out to address the carpet

Yes, to the recessed bookshelf. The more awkward nook is on top IMO. It makes it look like windows were covered. I'm wondering what kind of illusion it would create if you mirrored just the top of the nook.

Stack firewood in it, to balance out the fireplace side.

Thanks all - have a lot of ideas to try out now! Moving in next week and this one thing is keeping me up at night.

Based on the suggestions, going to play around with 2 things here - 1) keep the fireplace as is or make it lighter to avoid bringing too much attention to it 2) either a closed bookshelf with glass or stack up logs

excuse my poor photoshop skills lol

If you stack logs in the opening then I would definitely build out a wood base with trim - I think they will look weird piled on carpet

Stacked logs is a good look . . . in magazines. Unless you're actually going to burn them they quickly become dust magnets. And spiders love them. I mean, how do you clean them? I vote for doors as you show in your first photo.

As above- hard no to stacked firewood stored in a modern home’s living room. Yuk. And it won’t stay stacked the same nor be composed of lovely uniform sizes and colors of sanitized firewood.
If do have a word burning fireplace, it can work to have a basket or metal kettle or other container to keep 2-3 split logs you’ve brought in to replenish the fire of the moment.

Why can't I type on my phone in Houzz??!! Above is what we did to mimic the look of stacked wood. My DH is too cheap to use the fireplace except that one day a year when the temp and wind are just right so we don't lose heat.

We cut logs into 1/2 to 3/4 inch thick slabs and glued them onto a piece of plywood.

That is hilarious.

I really like your fireplace and would just add some doors to the new storage area. It appears to be a lovely home!

If you have kids, put on doors and have it be a hang out for them. My grandparents had a space like that and I loved hanging out in there. No kids, not your cup of tea? Open shelves or shelves with glass doors. I kind of like the dark tile. Here's to better sleep.

Throw some doors on and worry about the weird windows above the fp. They look like a mistake thought I am not sure what can be done to change it.