I share your problem. My girls are 10, 5, and 1. My son is 8. We have 4 bedrooms, but one is in the basement (which is unfinished, and frankly pretty dirty and gross), so we are stuck with squeezing 6 people into 3 bedrooms. The kids rooms are really small, also. We don't have room for them to keep toys in the bedrooms, so I had to clean out the garage and turn it ino a play room for all of that. We have a bunk bed in one bedroom, and two twin beds in the other (tight squeeze!). We have had our 1 year old's crib in our bedroom since she was born. I agree that the older kids should have their privacy, but we simply don't have the space for it. We can't cram our 5 year old into our room for that, and since we are only renting, we aren't going to waste the time and money to finish the basement to make it livable to access the fourth bedroom. What we had to settle on is that during the day, the older kids have their rooms to themselves whenever they want to have their privacy. At night, my 5 year old will sleep in one room or the other. I don't see that it's hurting anything, since they don't have to share beds.
If putting the new baby in your room isn't an option that would work for you (I wouldn't prefer it, but we didn't have another choice), then I would recommend putting the older kids together for awhile. When the baby wakes up in the middle of the night, you don't want him/her waking up your boys, and younger kids will sometimes disturb the baby as well out of curiosity. It probably won't be ideal for your oldest son, but short of building on a new room or moving to a new place, everyone will have to make an adjustment of some kind. I think the suggestion of giving him a place for his things out of little brother's reach is a really good idea. You can even ask him, if his brother shares his room, how would he like things set up? Let him help decide how the room will be, so he won't feel like he has no say in it.
I hope it works out for you, and congratulations and good luck with your new little one!