Harvard Business School’s Kresge Hall will be torn down to make space for the new Ruth Mulan Chu Chao Center, following a $40 million donation by the Chao family, Harvard administrators announced Friday.

The Chao Center, which is expected to break ground in 2014, will serve as a central space for students from the Executive Education Program by providing classrooms, dining services, and offices.

Harvard Business School Dean Nitin Nohria thanked the family members for their donations at the announcement of the new construction project, which is named after Ruth Mulan Chu Chao, wife of James Si-Cheng Chao and the mother of six daughters, four of whom graduated from the Business School.

“What a wonderful thing to have a building on this campus that is both named for a woman and comes from the gift of four daughters,” Nohria said. “It is so symbolic, so wonderful for us, to be able to announce this gift in a year in which we are celebrating 50 years of women graduating from Harvard Business School.”

The Chao family’s donation is the first gift the Business School has received from a family of Chinese descent. The Chaos are also the only family in history to have four daughters graduate from HBS.

“It’s just so great to see this family in its extended form,” Harvard President Drew G. Faust said. “We have these generations of dedication to what matters most here at Harvard to all of us, and that is the power of education to generate opportunity, to create possibility for everyone in our society, for women as well as men.”

Among the Chao family’s daughters is former Secretary of Labor Elaine L. Chao, who served under George W. Bush and was the first Asian Pacific American to be appointed to a U.S. Cabinet. Chao, who received her M.B.A. from Harvard in 1979 and is married to Senate minority leader Mitch McConnell, reflected on her mother’s legacy during their family’s immigration to the United States.

“The initial years in America were very difficult. Adjusting to a new life in a new country with a different language and culture was not easy, but, through it all, my mother’s quiet determination, her resilience, hope, and optimism supported our family,” Chao said.

From the Chao family’s gift, $35 million will go to the construction of the Chao Center and $5 million will be set aside for a fund to provide fellowships for Chinese heritage students at HBS.

“Our aspiration for the Chao fellowships is to enable the broadest range of outstanding promising students to access the financial means to be able to attend Harvard Business School,” Chao said.

The plans for the new Chao Center were announced as construction continues on Tata Hall, another building dedicated to the Executive Education Program at Harvard Business School. Tata Hall, a $100 million project made possible by a $50 million donation from India’s Tata Group, is expected to be completed in December 2013, months before construction on the Chao Center begins.

Also present at the announcement was Boston Mayor Thomas M. Menino, who spoke about the significance of the Chao Center in light of Harvard’s continued construction on its Allston campus.

“This will be a world class building that will attract world class executives who will go back and do great things—start and grow companies, create jobs, and develop new products,” Menino said. “It demonstrates the direction that Boston’s moving as we build on our status as a leader in the global economy.”

The Chao Center will replace Kresge Hall, which was built in 1952 and currently serves primarily as an Executive Education dining facility. After Kresge Hall is torn down, the Business School will rename a street that runs through the area as Kresge Way.

—Staff writer Brian C. Zhang can be reached at brianzhang@college.harvard.edu