I think having a uniform floor covering is going to make a huge difference.

If it were my place I would spring to move a water hook up into the corner of the main room and install a small 'L' kitchen there. You will have to add piping and drainage using the bathroom water main. This would leave the current kitchen room open to use as a tiny sleeping niche separating public and private space and maximizing the function of the main space.

I don't have any contractor advice past ask people you know and neighbors, and also check ratings online and the BBB. Someone with an A+ rating has worked hard to get that. Trust your gut when meeting with people for quotes - and notice how quickly they get back to you and how detailed they seem. This is a representation of how they run their business and how future projects with them will go.

Looking at your floorplan, I personally would try to carve out a bedroom nook while you're undertaking this work. Even though it will lessen the open studio-ness of the room, I would bring the living room wall in further from the bathroom so that a standard 3-foot door entrance would be on the left. I would then create a bedroom, no larger than 8'x10', in that lower right corner of the LR by having a full height wall perpendicular to the hallway wall, and then perhaps a half wall, or one with windows (for light) at the top that runs parallel to the hallway. I might even then tuck in a small door (24" if space is tight) in the lower right corner that would serve as a 2nd door into the bathroom with direct access from the bedroom. 8-feet wide would still allow for small bedside tables on either side of the bed. You would want to extend a couple outlets into these new walls too. OR, if construction like this is not allowed, you could have a carpenter build these in such a way that would not be permanent - more like a huge piece of furniture. The bottom of the L (running into the LR) could be a simple 8'x8' wall from nice birch plywood, and then the long width could be a half wall that doubles as a bookcase or drawers and would give the structure enough weight and stability that it could be freestanding.

If you're just looking to refresh the place, new flooring will go a long way, and I would go with something throughout the whole place. I've used a product from Home Depot called Allure interlocking vinyl. It comes in full planks and clicks together just like laminate, but it looks much better and will last much longer than cheap laminate (or even hardwood). It's a bit more expensive than your run of the mill laminate, but it isn't that much more.

Aside from that, updating the switches and plugs to something more modern and clean, obviously a new paint job (make sure you clean the walls really well with TSP or some other cleanser that will get the hand grease off the wall, then prime!), I would put some bigger baseboards in the whole place as well as try and remove what looks to me like a popcorn cieling.

If you're going all-out, you could take the advice of @MunichMom and build a galley kitchen in the main area and make the existing kitchen into a sleeping area, which would add more value once you go to sell.

I like MunichMom's idea though it sounds like a lot of work. About a year ago I saw a kitchen (maybe on AT, I can't seem to find it) of a kitchen that was in a living room and made to look like a modern series of shelves. I'll look again later.

Otherwise: http://community.apartmenttherapy.com/contests/smallcool/2011/entries/901
and all the other small space competition design entries are a great place to start.

Floor to ceiling, wall to wall built in bookcase, cabinets, closets, shelving, murphy bed, food pantry...whatever you can squeeze along that long wall in the photo. Then you could remove the closet in the kitchen and run cabinets along the wall to make a true galley kitchen, or remove one of the other closets to make a small office or dining area or combine the two small closets to make a sleeping room. The point is, the more storage you have built in for multi uses the more spacious your place will ultimately feel (and as a bonus it'll add to resell value).

Why not just add more of the parquet floor over the areas that have those old vinyl tiles? I don't know, I just don't like vinyl or laminate ever. I think the parquet is pretty, it's not expensive, and it's already there.

Moving the kitchen is a great idea. I would suggest hiring a kitchen designer for that one, only because there are only a couple ways to do it right, and about 100 ways it could go horribly wrong.

I'd make the right hand corner closest to the bathroom the TV corner (assuming you have one) and then have 2 couches facing it to create a corner opposite the TV so you have a little square living room and you can have a coffee table there as well. Behind the couch directly facing wherever the photographer is standing (the one splitting the room down the middle) I'd place one of those ikea bookshelves that everyone on at has and fill that with dvds and books/other things. The bookcase would divide the area in two and you could hang curtains from the end of the bookcase to the other wall and then on the other side of the curtain and bookcase I'd have the bedroom. Hope that's clear and understandable haha.

One of my absolute favorite places to shop in Brooklyn is Greenhouse on Atlantic Avenue (Cobble Hill) - which is eco friendly. It's not entirely inexpensive, but it's not over the top either. They sell new stuff and antiques. If nothing else it is awesome for inspiration. Also, for a modern apartment like this one, I think layering makes a dif. I usually prefer prewar but was surprised by how much I absolutely loved this take on modern bones featured on designsponge:

http://www.designsponge.com/2012/01/sneak-peek-jennifer-sarkilahti-of-odette.html

Architect here. I wouldn't change the kitchen into a bedroom, it might not be up to code (not familiar with NYC specific codes though). What I would do: Take out the closet in the kitchen, use a run of uppers as lowers along that wall instead. Combine the two closets to make one walk-in closet with a pocket door that faces the kitchen. Pull the bathroom door out into the nook and make the space in front of the existing smaller closet a separate linen closet accessed from inside the bathroom. Build a radiator cover type thing with a perforated metal front that stretches the whole length of the front wall to hide the heater and the air conditioner. Incorporate storage into it as well. A bunch of throw pillows and a seating pad and you have an awesome window seat. I would second the opinion to keep the parquet flooring and add to it. It's classic and will wear better than laminate, which I hate. Try searching images where parquet has been refinished with a medium-dark stain, it looks great. Or a sanded bare look for something more Scandinavian. I'd place a bed in the corner near the bathroom, maybe a modern styled canopy bed with shears all around it. Let the living space be towards the windows. Use a large mirror, a la Vincente Wolf. Finally, a modular shelving/storage system along the entire left wall for media, books, art, whatever. I'd paint the whole place one neutral color, please, please, no different colored "feature walls". The small bathroom I'd make a jewel box in a dark color, navy perhaps?

Okay, I now can't stop thinking about your floor plan (and I have work to do :P). I'd knock out the closet in the kitchen and put in a long, thin sideboard on the other wall. You can use that as your working counter space. I did this in an old apartment and it worked well, you just have to keep it clear. You can use the space underneath to hold all your pots, pans, and plates (I had the IKEA Norden) and stash the food in the cabinets you hopefully have on the other side. I'd stick to only having overhead shelving or cabinets on one side or it's going to feel real small real fast. If it works for you, opening up the entrance into the kitchen (since you removed the closet) could make it feel much more open.

First, I assume the fact that this is a "we" means that this is for two people, and that you're actually going to live there and not rent it out as an investment, so my answers are tailored accordinly. Personally I would skip the bedroom idea and get some kind of murphybed - I'm particularly fond of the HiddenBed from places like http://www.bostonwallbeds.com. Installing one of those, perhaps as part of a big built-in bookcase/armoir would be a big improvement to the space and worth the expense because it would make it much more livable for two people. It would also make it an attractive rental for a couple as well. It's not clear from the floorplan, but if you could rip out the closets and install the bed in that area you might even be able to create a kind-of one-bedroom. If not, that little nook on the right would be perfect.

Second, I would say that if overhead lighting is something that you want, do it now when you renovate. It's not so hard (or expensive) if you find the right contractor but doing it at another time will be a big hassle because of the drywall mess. I'd personally go with recessed lighting installed every 3-4 feet (depending on wattage). Halogen is not very green though, so you may want other options. A big fixture hanging from the ceiling is going to dominate the room though, so I would avoid that.

For paint I would definitely put some color on that outside wall - a nice darker color would really make the windows pop and emphasize the light you have in the place. I wouldn't do just one wall of course, probabliy at least the right wall as well if not the whole place. I'm fond of "warm (brown) greys" but that's a matter of taste.

I'd also look in to getting a shroud for heater/AC below the window - they're an eyesore.

If you're looking to do this all yourself, you probably can't do the lighting. But assuming you're going to get a contractor to do your bathroom, check out Doha at http://luxuryconstructionny.com/ - he's personable, very patient and does good work at a very reasonable price.

This plan sounds best. I'm with BethAM- window seat and wall-length shelving / storage!
I'm not a huge fan of parquet either, but it can be quite lovely when stained dark. Do this!

You should think about a sliding/barn door for the bathroom. Take the doors off the smaller closet so that the door can slide into the closet space. Use that area as open, but out-of-view storage.

If you're looking to use green materials - look into Build it Green in the Gowanus. they carry a lot of raw materials, furniture, fixtures that have been donated by renovators.

Atlantic ave is a goldmine, design wise. Housing works on Montague carries some good furnishings on occasion.

I love this kind of challenge...it looks like an Ocean Parkway apt which I know oh too well.
first off...flooring. decide if you like light or dark...I feel there is no middle..I just did white quarter sewn oak and used Rubio topcoat to "fume" them naturally resulting in floors that look like driftwood!! I love them so much so I highly recommend. the light gray brown creates a earthy and modern fresh look and it's natural!! no toxic crap!!
next...I would use the front area to the left of the window as your bedroom, utilizing the left wall as your headboard and divide the space with both an enclosed cabinet on the bed side close to the wall and a open shelving unit next to it. this will allow the light from the only window to still be a part of the room and yet provide privacy for the bedroom. I would hang curtains behind the bed and continue them across the wall of the window..
I would put a gigantic mirror to the right of the window which will create another window by bouncing the light around...
I would leave the kitchen alone...it's never gonna be a bedroom!!
I would then buy a small L shaped sectional to go on the right wall as you enter facing the left wall which could have an entertainment center/dining room function...housing your tv and dining room things, a bar, etc..there could be a small round table to the left like the Saarinen copy At ikea with lucite or acrylic chairs around it which will keep the space feeling open and light.
The tiny wall that juts out next to the bathroom could have a small table and a mirror over it.. For throwing down your keys etc when you come in...creating a foyer space. Look at the cb2 acrylic one if it fits!!
I would consider painting the main wall on the right a nice soft color like a pale gray or my fave color called pale smoke by Benjamin Moore...
Buy everything that has two functions because you will need storage! Or that can wheel around and change positions... Check out Houzz for ideas and on apartment therapy there are many layouts of studios discussed. good luck!!!

I would go with BethAM's suggestions as I think it utilizese the space really well without it becoming a huge project to move walls around.

I second or third the "keep the parquet" advice. I have my original 1968 parquet in my condo and I had it refinished and stained a med brown and it looks fantastic. I thought about switching out to laminate but I decided that real wood would be preferable to fake wood. It's relatively inexpnsive and you should be able to find someone who could fill in the missing areas.

If you're looking to be "green" then keeping the flooring and adding to it is the greenest you can be.

Is there really so much leeway in moving kitchens in NY apartment buildings? In the condos I've had experience with you had to back kitchen to kitchen and bath to bath. You couldn't just move one to another room without the linkage. But the L-kitchen is a good idea.

When I look at your floor plan I think: combine the closets into one closet/dressing room, unify the flooring by going new or completing the parquet, split the studio space about 10 feet from the window with a retractable wall (transluscent) or curtain or panel and have sleeping quarters and desk by the window. I'd get rid of the stub of wall by the bathroom.

Your condo looks to have been built by the same folks who built the apartment building I used to live in. In which case all the talk of moving walls and putting things in the ceiling may be largely moot: in my building the walls -- and ceiling! -- were all SOLID CONCRETE. We couldn't even hang paintings on nails.

As to use of the space, I'm a big fan of using Ikea's STOLMEN system (meant for closets) as room-dividing floating shelves/cabinets -- it might be a nice way to section off a sleeping area without blocking too much of the view.

"Upgrade electric;" elaborate please? If you want to add ceiling lights your best bet is low voltage track lighting. Tons of places on Bowery, you can easily comparison shop by walking to the shop next door (and next to that, etc.).

You will need the wiring done by an electrician, but you can install the tracks yourself.

I'm pretty sure you should hire BethAM to design it for you :)

If you do decide to partition off a sleeping area, make sure you still have a clear view from the front door out the windows. That'll help keep things feeling larger...

In NYC, most buildings require "wet over wet" - so forget moving the kitchen. Even if you could, I would tell you to buy an apartment with the kitchen I the right place, because it will cost you a fortune.

Get to know your neighbors and see if any of the building staff is a talented handyman with a good reputation who will take on work for the residents and also whether they hold any relevant licenses. If so, that is likely to be your best option for painting and helping you install things, at a minimum. If you really luck out, they can redo your bathroom. Also ask them for names of handymen and contractors. Forget about having anything built to order - even in MDF, it costs a fortune because it is very hard to find good carpenters who aren't cabinetmakers. For things like tile, try some of the Chinese owned shops on 3rd Avenue under the highway - I think one is Galactic tile. A friend who just redid her baths went there, at the recommendation of her contractor. Not fabulous, but acceptable.

If you do an Ikea kitchen see what The Kitchen people's reputation is these days. A former neighbor who does some type of construction used them and spoke well of them.

I would combine both closets into a walk-in with a picket door or a door that opens out - maybe behind the front door. Make sure the closet goes up to the actual ceiling. With one tiny closet, you can't afford to make the other into a linen closet. Use ELFA shelving (25% at the Container Store through the end of January) to maximize storage space in the closet. Pricey but worth it.

Something under the windows - of course - but be sure you don't block the heat and the A/C airflow. Also, make sure it is easy to service or replace the A/C.frame the window with bookcases or storage, up to the edge of the columns. I can't tell what that brown thing in the middle of the windows is but make it go away, if possible.

Removing popcorn from the ceiling is easy if it hasn't been painted - or even if it has BUT you need to test for asbestos if built before 1986 and forget about skim coating the ceiling - it is a fortune.

Wherever you put the bed, get a storage headboard with shelves so you can forgo night tables.

What a great space! I love the tile even though it is more than likely asbestos tile. So If you must feel new flooring is a must then proceed with caution and be prepared to pay for hazardous removal and disposal. The floors look to be slightly different levels so even floating might result in removing parquet which I'm assuming has the tile underneath it.

I'd forego the idea of moving or adding walls until you live in the space for at least a year. During this learning period replace the closet and bathroom doors. Since you mentioned green I'm going to suggest you can get some shoji screens (if that's your style) custom made for closets and bathroom. http://www.shoji-living.com/us.html.

I found some modern radiator cover/ window seats/ shelving here. It's a green company as well it seems.
http://www.hudsoncabinetrydesign.com/galleries/radiator-cover-galleries

When I think of all the rented flats I've lived in with awful laminate floors, I would have killed to live somewhere with that beautiful parquet - are you not able to cover the remainder of the floor with more of the same?

To all who have responded with thoughtful ideas many thanks.
The studio is actually for our 24 y/o son and although he will have some say in the plans I am looking for options that may enhance the space before he moves in and before the remodeling starts.
We do not want to do structural work and the kitchen will need to stay as is.Some of the other ideas of where to place the bed and how to divide the space are very good and helpful. I will contact some of the contractors suggested and will keep you posted.
Thanks again
Dorothy

grozack - that would have been helpful to mention in your post. decorating for a 24 year old is... extremely different than for a couple! or even an adult buyer.

co-op or condo? big difference on how much can be changed w/out board approval. also note that, while the living room area is big enough to allow a kitchen in the corner, in nyc, it is a code violation to sleep in a room w/out windows (see: how the other half lives, by jacob riis as to why). good to see a floor plan in a post! there seems to be plenty of room to have a living area & sleeping area w/out floor/ceiling walls (in tribeca, it gets called a "loft"); bookcases that are backless or act as a foot board are effective space dividers, except for watching tv from the bed. might not be worth it to change the parquet; a good buff & topcoat, also the same floor throughout, would work.