This one is a bit tricky. 'Werkstatt' translates to 'garage' only in the sense of a car repairing facility. However, the 'meine' indicates that this is not meant here and the best translation is indeed 'workshop'. Technically it would be possible to refer to a car repairing facility that you use regularly as 'meine Werkstatt' but without further context the most natural interpretation of the sentence is 'my workshop'. Note that you can't refer to your garage at home as 'Werkstatt'. That would be 'Garage' in German. (Unless you use it as a workshop, of course.)
That's not always true- I've since discovered the original grammatical rule behind my original question. It is possible to use der/die/das as demonstrative pronouns, that is to mean 'this one' or 'that one', but it seems only (unlike in this sentence) without the noun. So you can legitimately say 'Die sind mir zu teuer' (Those are too expensive for me) or 'Der hat keinen Nutzen' (That [one] has no use). How exciting!
yeah, well. This link says it's colloquial language, and still to use this you gotta have some context http://deutsch.lingolia.com/en/grammar/pronouns/demonstrative-pronouns Without context I guess "das" is used more frequently (I'm not a native speaker anyway, just haven't seen such a construction before).