The LOTS (Living Over The shop) scheme has aroused little response. Around 1,200 buildings in some of Dublin's most well-located streets are half empty, as spaces above shops are often derelict or used as storage. These properties could be converted into much-needed apartments.

The LOTS scheme - also running in Waterford, Limerick, Cork and Galway - offers 100 per cent tax relief on the cost of converting the spaces over shops into apartments. Yet of the thousands of homes identified by the council, only 35 have been either built or are planned. The deadline has been extended from December until the end of July 2006 (but planning applications must be in by the end of 2004).

Dublin City Council has put together advisory teams of architects, quantity surveyors and valuation surveyors to give property owners guidelines on how much their property will cost to refurbish and on the returns once building work is complete.

Of the 35 schemes in Dublin, one landlord is responsible for three. This landlord has employed O'Briain Beary Architects to work on all of his properties. The latest, above the Irish Cancer Society shop on Camden Street, involved more than a refurbishment, as the roof was rebuilt and the architects took the opportunity to add a roof terrace.

This scheme of two apartments offers an example of just what can be done with LOTS. The enhancement begins at the entrance, where the inner door is higher than standard and filled with glass. The first floor apartment is an above-standard refurbishment which involved, say architects Esmonde O'Briain and Michael Beary, "the usual stuff". The client's brief was for low-maintenance apartments that looked and felt different from standard new apartments.

On the first floor return is a communal utility area where residents of both apartments can use a washing machine and store bicycles or even canoes.

Beside this is a shared roof terrace comprising a larch post-and-beam construction with wooden floor, pergolas, benches and chunky wooden troughs. It's a lovely place to sit out in.

In the top floor apartment the architects have grabbed every opportunity to display their inventiveness. Somewhere in its history, this building lost its pitched roof. The restoration of this enabled the architects to play with shadows, light, space and lines by creating a ceiling within that curves upwards from the livingroom to the upper level kitchen. There's a long, thin gap where the ceiling meets the wall of the stairs up to the kitchen.

The wall into the kitchen is at the same height allowing a view across to the living-room ceiling without giving, unless you stretch, a view of the whole room. "It enables you to have open-plan but with privacy," says Esmonde, "and a feeling of space but with distinct rooms - it makes it ambiguous."

Clerestory windows between the top of the curved ceiling and the kitchen roof enable a play of light and shadows which change throughout the day.

These clerestory windows bring in morning light from the east while huge sliding glass doors on the west side of the kitchen bring in the evening sun.

The project began as a refurbishment but gathered momentum, say the architects who, once it was clear that the roof was going to have to be rebuilt, suggested a terrace at the upper level. So in what may be seen as complete indulgence these over-shop apartments now have two terraces between them. The upper terrace that leads out from the kitchen has the feel of a boat, with its timber deck and twinned curved stainless steel rails above framed glass panels.

In the conversion the architects have followed the brief to match the level of finish in penthouses in the plusher new developments but, as the architects say, when the opportunity for the extras arose it was all about "going the extra mile".

Dublin City Council themselves refurbished buildings at numbers 3 and 4 Capel Street as an example of how derelict buildings could be converted into - in this case six - apartments. Now the O'Briain Beary scheme adds to the list of good examples of LOTS conversions.

LOTS in Dublin 01-2222141 or edu@dublincity.ie