Disclaimer: I don't have any experience as a city planner, engineer, etc.
If they're going to do a massive overhaul of the Welch Ave/Campustown area to make it pedestrian/bike only, why not relocate the FD as part of the overhaul process? Move it over to Hayward where the India Palace and Domino's locations are (aren't they closing/being forced out?) if they have to have a station in that area. Or somewhere else, I can't keep up with what has changed since I'm not in the area.
Just saying that if the FD is the only thing holding the town back from making this area a ped mall (it's the only substantial reason I've ever seen given), they'd find or build an alternative location if they really wanted it to be a ped mall.
/amateur thoughts