Based on the photos, it appears that the terra cotta block have 2 different heights as laid and the length along the wall is shorter than most tile. Based on the condition and layout, I suspect the tile were original and later construction, as evidenced by the dimensions, condition and configuration were topped with the recent concrete.
Despite the orientation, the clay block have been used for decades for moderate loads because of the multiple cells since they were normally laid in a full mortar bed. I have seen 4 story apartment buildings built using similar units in the last 15 years. The details are not the "canned" American details/concepts, but they do work well.
I owned a architecturally significant home that was built in 1917. The structural walls were very similar 10" thick clay block with horizontal tiles. One story flat roof with interior roof drains. The foundation as the old 12x6x24 concrete block. The ceiling heights were 9'+ plus the tile continued up about 3' to support the real roof (that carried the external snow loads) and was pitched to the center to the interior drains. The interior of the exterior walls was full 2x4s with horse hair insulation and then lath and plaster with a 1/8" "china coat". The exterior was stucco. No money was spared in construction and the pristine birch Greek 10" dental trim was never stained or varnished, but was painted from day one, just as all trim was. As an example, the 8'x10' sun room had 8 casement windows with copper weatherstripped interior windows that had to be changed seasonally.
As far as the original poster's subject property, it appears the recent modifications were not well carried out (an abortion?)and the clay was used as just an existing minor support material with little regard to drainage, which caused the deterioration. In the short term, a weatherproof cementitious coating combined with correction of water control with provide years of life until the ultimate use of the aging structure can be determined.
Dick
Engineer and international traveler interested in construction techniques, problems and proper design.