Credit Union To Open in Square

Harvard Square will be home to seven bank branches at the end of the month when the Harvard University Employees Credit Union (HUECU) opens in the Dunster Street space vacated by City Sports last June.

Eugene Foley, president and CEO of the non-profit bank open only to Harvard students, alumni, staff, and their family members said that the new 3,500 square foot location will be almost five times larger than the bank’s current spot inside the Holyoke Center Arcade.

“[The] small arcade [space] hasn’t been enough for us to meet the needs of members,” he said.

Foley said that all of the bank’s operations, except the mortgage business, will move into the new branch. The mortgage business will run from the bank’s current location.

“It will be one stop shopping,” he said.

A representative of Harvard Real Estate Services, which manages both the Holyoke Center Arcade and the Dunster Street spot, would not comment on how the bank was selected to fill the space.

But Foley said that HUECU had been interested in moving in since last September when the bank learned that the space was available. He added that the bank had a commitment to remain in the Holyoke Center Arcade.

Although HUECU is not a national chain-it has branches at the Massachusetts General Hospital and in the Longwood Medical Area, its expansion mirrors a Harvard Square, and national, trend.

Banks are opening more branches as they return to a branch based business model.

Last November, Citizens Bank vacated its 1290 Mass. Ave. location for a new 12,000 square foot spot in the heart of the Square. Sovereign Bank,

which currently has only one ATM in the Square, plans to open a 2,500 square foot branch between CVS and Bank of America later this year.

According to Finard and Company, a commercial real estate service firm in Burlington, between 2000 and 2004 the number of banking firms in Eastern Massachusetts decreased from 268 to 200, while the number of bank branches in the area increased from 1,243 to 1,328.

But Foley said that the opening of the new HUECU had nothing to do with the resurgence of brick-and-mortar branches.

“We’re just moving into a more convenient location,” he said. “There are 27,000 credit union members. The lion share [of our business] is within Harvard Square so this is pretty much our exclusive marketplace.”

Robin Lapidus, the executive director of the Harvard Square Business Association, said that she was not concerned that another bank branch was opening in the Square.

“It would be great to have visionary retail in every visible place in Harvard Square but there are 375 stores,” she said. “[The] goal has to be to get people to see what [is] already existing in the Square.”

Foley said that the new branch plans to open May 31.

—Staff writer Joseph M. Tartakoff can be reached at tartakof@fas.harvard.edu.