dwm- Appreciate the insight. So you would bias the lift towards one side so you have room on one side for benches and tools? I am trying to get it planned out all in advance which is why I was curious to hear from others. (if it was the consensus that 20ft wide would be too cramped for example). Seems like it might be ok if arranged properly.
vovka- not so much a problem as a dilemma.
mr overdunne- I must know you because that's too random to be a lucky guess. Ferrari was sold to help finance the Cadillac btw.
Yes, I would put it to one side because ideally you have lots of clearance front and back of a car on the lift to roll things out from the front and rear. So it's going to wind up somewhat centered front-to-rear for optimal access. If you also center it side to side, you'll wind up consuming a lot of space for the lift or being cramped when you need to do something like remove an engine and entire drivetrain of a RWD car. In a dealer service garage, it's really no problem to have one end of the lift near tool cabinets because a car doesn't typically have major work done on both ends and they rarely pull engines or transmissions versus the zillion other things. For us weekend warriors, a car could be on the lift for months or longer and have major work done on both ends before it can move under its own power again. Put roller cabinet(s) with automotive tools on the wall in front of the lift (furthest from the garage door). If you need more space in front of a vehicle on the lift, you can roll the cabinet(s) out of the way. But you can't move a wall on a whim, and you need access from front and rear to get the big jobs done with the car remaining on the lift.
But that's just my preference.
Others are correct... keep the 20x40 as working space and you should be just fine. Keep the stuff you don't use regularly in the other garage. Use the space effectively and keep reminding yourself that it's a work space, not a storage space. That last part can go a long way toward retaining comfortable working space. Every few months I try to scan my shelves, slatwall, GearWall, FastTrack, etc. and find items I haven't used in a while and have no immediate plans to use. Those items get moved to the basement, sold, gifted, thrown away, whatever. As does everything that isn't a tool or a regularly-used consumable. I also shuffle some things seasonally. In your case, I'd move them to the other garage. Extra T8 bulbs? Case(s) of shop towels? Bottles of Kresto and Cupran for the dispensers? Scrap wood/metal? Cases of WD-40, brake parts cleaner, acetone, denatured alcohol, mineral spirits, extra gas cans, cases of motor oil, paint prep, etc.? Don't keep them in the workshop. Keep just enough in there to not have to go to the other space to get more in the middle of a job. Keep the handtruck or whatever you use to move things from the other garage in that other garage.
You can make effective use of wall space even with the lift close to the wall on one side. Put up some slatwall or GearWall or the like and you'll have a lot of options. Also a good spot for an air tool rack to hold impacts, air drill, die grinders, inflator, air saw, air chisel, pneumatic random orbitals, etc. And depending on your setup, your MIG gear, plasma cutter, etc. can be fit in a fairly small space if you plan it.
I've seen a lot of cluttered garages over the years that have a lot of unutilized space. And I've seen a lot of well-utilized ones here in this forum and in person. For the cluttered ones, 9 times out of 10 it's because too much stuff is sitting on the floor while the walls are bare from 6' up or have cabinets that aren't suitable for storing what's in the garage (cabinets are half empty because stuff won't fit in them). If it were me (and we're really good here at telling you how to spend your $$$

), I'd cover the walls on the lift side of the garage with slatwall, either wood with metal reinforcing inserts or one of the many PVC products. Definitely from 6' to the ceiling, if not from 2' to the ceiling or whole walls. My most recent favorite is ProSlat, due to ease of one-man installation, the hidden mounting screws (it looks really nice installed), price (I got 4'x8' kits for $134 each with free shipping from Home Depot), and the fact that they're impervious to moisture. The downsides: their trim is specific to their product, or at least the top trim is (Gladiator trim will work for bottom and sides), and the slat spacing is atypical (so accessories for 3" spaced slatwall that engage two slots will not work on it). Also wants 2" or longer panhead wood screws that you won't easily find at the big box stores (I order mine from McMaster-Carr when I need more than what's included with the ProSlat or if the screws fall out of the ProSlat box during shipping). At any rate, slatwall leaves you a lot of flexibility for on-wall storage. Put your cabinets and the like on the other side of the garage where you'll have room to open the doors and have a better chance of keeping slag, dust, etc. off of them.