Broken images in all subsites

Images uploaded in the subsites are generating a 404 link , or it's broken.

Tried plugin/theme conflict test, .htaccess rules does look fine, debug.log files aren't being generated.

The sites upload path might be the issue, however changing to default setting ie blank doesn't seem to help much.

The following paths are being called which isn't correct:

http://sites.xxxx.com/demo/files/2017/07/main_slide_1-300x244.jpg
http://sites.xxxx.com/demo/files/2017/07/painting.jpg

Where xxx is added to mask the original site url.