Here, the player acquires a map of the World and learns to collect the Modules. The player also can change their Outfits here via three terminals, each one corresponding to a part of an armor set.
According to developer Alex Preston, the building is an apartment. [source]
The mirror mounted on the wall can be broken with a sword, and the Drifter's reflection becomes distorted.
If you are playing in New Game+, the third terminal, which allows you to access capes, will be turned off and inaccessible.
In the game's files, this area is referred to as "Drifter Workshop."
The Guardian, when alive, has a one in four chance of showing up in the apartment. The counter resets when the player leaves Central Town. The Guardian also turns off the lights before leaving the room. [source]
Examples of the mirror distorting the Drifter's reflection.
The diagram explaining what the Modules are used for.