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Advice on Re-Finishing Redwood Paneled Shower

I am looking for some guidance on re-finishing my old wooden shower. As far as we can tell, the previous owners installed a walk-in, two-room redwood paneled shower with a cememt floor. The house was built in the 1970s, and it appears that whoever made this modification to the original house intended on making the second room of the shower into a steam sauna but never finished, as there is a capped-off end of a water pipe sticking out mid way of the side wall.

For years, this shower sat largely unused and was only really utilized when we had guests, as it was proximate to our guest bedroom. However, in the last 5-7 years, it has seen regular daily use as the kids in the house have become old enough that they take showers instead of baths.

Over years of use, some of the wood has begun to show signs of dry-rot in places that get hit most with water. I took a small hand-plane and some sand paper to the wood, and it appears that most of the dry rot is on the surface, but in other locations near where the water hits the side wall, it is deeper than the surface. The walls away from the shower head show little to no signs of dry rot. The second room, for instance, looks as good as the day we acquired the house.

Is there something I can do to save my shower without having to completely re-panel it? Any advice on proper procedure or types of finishes to use on the redwood-paneled walls would be appreciated.

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