I'm not too concerned about the loss of a portion of Olympic Plaza, as it's not a very well designed space as others have mentioned. A lot will depend on how well designed the redo of the plaza is. Some of the space that is to be taken up by the new building is currently occupied by the Parks depot. The rest of that NW corner is basically a single pathway. They will, however, need to find a new place for the Famous 5 statues.
Having a new building fronting onto the plaza from the west is somewhat of a win, as "eyes on the street" ought to make it a more safe and vibrant space.