I started demolition on the basement alcove. You can see where I had the problems with clearance at the front. I plan on replacing those with steel studs. As I understood in a previous post, if the ceiling height is 7' or more it isn't considered an alcove. My problem is trying to hide the pipe at the top. I need some ideas. The bottom of the chimney pipe is about how high the tile will come down.
Here's some more pics
Here's some more pics
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