Pretty sure this is a old building and it's pretty likely that an other building use to stand were the open space is right now.
You can see on the right the normal size windows of the facade.
Those small windows most likely only give light to staircases or small bathroom/toilette, the rooms where people live have opening on the other side. So even though now huge windows could be made on that side, it wouldn't be worth it considering the risk to damage the whole building.
I'm not even talking about the legal side of it where you need to have the agreement of the citie who has to allow you to make new windows, and the agreement of neighbors who have to give you the right to have a view on them.
This scenario is pretty common in old cities when they take down buildings to make place/park or anykind of public open space.