What would you do with the space behind our garage

The stretch of yard behind the pea gravel patio is the only area of grass left on the property, and the task of making it look good falls on our shoulders. (We probably could have paid to have it fixed up, but I think we can handle it!!!)

The landscapers spread top soil along the patio banding, and we planted grass seed today (please please grow!).  We lent our lawn mower out temporarily, so I couldn't mow what little is there...

Here's the challenge (our dirty little secret): the area behind the garage is a barren muddy wasteland*.  I am desperate to make this space work for us. It was most recently used as a dumping ground for the landscapers.  Today we separated the rest of the debris from the soil and rocks, and spread the mud around.  I raked the largest, ugliest clumps of clay up against the fence. 

I think it could be a cool place to build a wooden play house or elevated tree fort (elevated, meaning two feet off the ground or less).  A sandbox might work, if it had a cover that could be locked down. Other than that, I don't have any bright ideas. Please tell me, what would you do?



*We tried growing grass last year....it sprouts up, and then promptly withers and dies. I am not sure if it needs more water, sun, or better soil.