Ideally we would take out most of the wall and make sliding doors so that the closet is more accessible, but we're pretty sure they are main supporting walls, and that just sounds like a lot of work. Instead, we'll work with what we have. Matt is going to make horizontal shelves on both the left and right side up to the door, and then we'll have a long shelf across the upper part all the way across the closet, and some space for storage and some hooks on the wall. We keep our iron and extra bathroom and cleaning stuff in there, along with towels and sheets and the usual linen closet stuff, so we need versatile storage. I think it will work pretty well!
Here's some inspiration to get us motivated: