Obviously KWT has a different agenda here, and that is to preserve a building at least until redevelopment starts. This is about saving the city from another blight on the corner of the highest profile intersection in the city (arguably). This is about the developer wanting a surface parking lot or nothing at all here for potentially many years until this development starts, at least that's what I take from it. I think those arguing for the parking lot over the current building are way off. Also I agree with Greenleaf, there is some merit to having the 2 storey facade left alone. I think it might look quite nice wrapping around the front of a new development here. Also, one article mentioned Mizrahi's admiration for the older architectural styles, and if that's the case, it might work. (Not saying I think its the place for gargoyles and flying buttresses, but the facade could work on something with an art deco flavour, and might play well off of uptown as well.)
Also if we were to have a parking lot here, and the market tanks,(like it very well could for multiple reasons,) who knows how long we will be stuck with it.
Pretty much the same reasons why I support a heritage designation.
I don't think Stollerys is worth keeping as-is, but have a blight similar to the south-east corner or Yonge/Gould or the infamous blue hoarding at Yonge and Dundas is a real fear if a demolition permit is issued before work is ready to start on the new replacement. It also gives the new development opportunities to incorporate any heritage features from the current building, which has its charms.
I don't think the Waverly Hotel/Silver Dollar Room building is neccessarily worth saving either; but the heritage desingation is good as gives the city leverage to fight the developers on a bad proposal (the developers are bad people too, IMHO) while recongizing the heritage of the site. (Which given an appropriate redevelopment, can be marked with an interpretive plaque, for example.)