Shed Conversion Ideas

[Ryan Schildroth]

I just purchased a single family in KC that I'm going to make a full time STR. It has a great outdoor patio and yard area, and a very large shed that I envisioned turning into a bar/hangout area. Because KC experiences very warm summers and cold winters, I thought it would be best to at least add insulation to the roof and walls, but I'm way out of my element. Curious if anyone has handled a similar project, maybe while converting an ADU, and could offer advice on options I might have. I plan on asking some contractors, but I'm frankly still in the relationship building phase, and want a little more knowledge going into those conversations.

TL;DR: I have a shed and want to make it comfortable for my guests to hang out in. What's the most cost effictive way to insulate? Dry wall vs. something else, like wood-paneling? Do I still need a split unit for heating and cooling? 

I've already started the process of running electric out there, and will probably add a water line as well. Any additional advice would be greatly appreciated!