I'd be interested in your colleague's justification as to why empty fields are bad. As far as I'm aware, empty or null fields aren't bad in and of themselves. If you have a lot of empty data values for a column that you are planning on putting an important index on, you may want to consider other options. This goes for any column where you have a lot of duplicate records actually and need an index, as duplicated records lower the cardinality of the column, making indexes less useful. In your case, I don't see it being an issue.
For this kind of data, you're likely using a VARCHAR or some kind of TEXT column anyway, which are variable length fields in the database. It doesn't matter if your field is full of data or empty, you're still going to incur the overhead of a variable-length column (which isn't worth worrying about in normal circumstances). So again, there's no difference to the RDBMS.
From the sounds of what you're designing, I think if you came up with a generic method of handling address variances in a single table, it would be the way to go. Your code and structure would be much simpler at the negligible (in my opinion) cost of some empty data fields.
