The challenge is that as you shrink individual room size, it gets harder to give every room a window. It can be done--though you may have to have smaller windows. And you basically need to have a more linear design or something that otherwise has a lot of outside surface.
You really just need to stick a courtyard in the middle of it, an extremely common design pattern in such buildings, including one SUNY dorm I lived in.
Or on a slightly larger scale, you stick a courtyard in the middle of several buildings, as is the case with most blocks in Barcelona or Berlin.
