When dealing with small spaces that are hemmed in with fencing/walls, you may be tempted to follow an interior design rule for space creation by painting everything white. However, the secret to creating a sense of space in an outdoor area (where there is plenty of light), is using darker colours as they create a sense of depth and thus an illusion of space. In brief: indoors use colours to work with light, outdoors use colours to work with depth.
A good choice for outdoor furniture is powder coated pieces that will resist the brunt of Mother Nature. When selecting the size, be mindful of the comfortable number of guests that you can accommodate in your space and opt for the smallest to suit. A bench seat along one wall will immediately create more seating for when the occasion calls and when not in use, style with candles, cushions and/or potted plants/herbs.
Espaliered fruit trees are a very popular (and practical) option for smaller spaces. When planted down one side, they draw the eye down the yard, enhancing that crucial sense of space. Choose tall and narrow feature plants at the end of your yard, such as ornamental pears or pencil pines, as they will carry the eye up… another trickery of illusion.
If room allows, the inclusion of a small plunge pool will calm the senses and, by choosing a darker colour, you will create an added sense of depth.
All in all, the secret to enhancing a small outdoor area is creating an illusion of space. Take in to account how your eye is drawn into the area, avoid unnecessary or oversized items (a ten seater table and chairs is probably not a good move) and choose your plants and their placement wisely.