It is hard to tell from the photo but I suspect it may be a traditional cement render with layers of paint over the top. It looks like you can see the original trowel finishes in the render. This recess was possibly used for a gas or electric fireplace as the paint and render would have been damaged by a timber or coal fire. However there is only one way to find out which is to carefully remove some of the paint. Be aware that it may be a harzardous lead-based paint under the top layer of paint which looks like it could be 1980's. If you want to keep your home fairly authentic I would consider using plainer tiles rather than the heavily patterned tiles which have more of a late 1960's/1970's vibe. Sandstone or face brick were commonly used in 1950's houses around fireplaces. Best of luck, Dr Retro of Dr Retro House Calls

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Thanks everyone, some great ideas. It’s only ornamental so we won’t be adding an electric fireplace but I like the ideas of just a plain black insert or grate with logs. Thanks for your time and the inspiration!

I would get the installation instructions for the fireplace you’re planning on having. They are usually available online and will have information on the surrounding construction required. Builders often have a reluctance to do something new, but they are also the one that has to build and warranty the work. You need to negotiate a position that you’re both happy with. If this column is just plasterboard and is just a cosmetic design feature it shouldn’t be that expensive. If the heater is installed as supported from the construction above rather self supporting from the base it may be a reasonable cost.