You will not recover space of any significance. The only space to be gained is that when parts of a file are in sectors that are partially full, the reorganization may allow some of them to be rewritten to full sectors. So it may shrink slightly but only slightly.
What messages about "free space" generally refers to is that you need free space in order to accomplish defragmentation. large files are the ones that generally result in the most degragmentation especially when they change size. So if you need to defragment a 2 GB file....it needs up to 2 GB of space to hold it temporarily, 2 GB for where it now is and 2 GB to put it somewhere. That can be cut down somewhat doing it sector by sector but you get the idea. It is recommended that you never let a storage volume get less than a 15% free condition.