AIA index of US non-residential construction rises

NEW YORK, Aug 22 (Reuters) - A forward-looking index of demand for architects' services points to continued growth in U.S. nonresidential construction despite recent concerns about tightening credit, according to a monthly survey.

The July Architecture Billings Index rose to 60 from 59.3 in June, the American Institute of Architects (AIA) said on Wednesday.

It was the second highest level in the survey's history, compared with a peak of 62.5 reached in August 1998.

Any reading above 50 indicates expansion, with construction activity typically lagging architects' billings by nine to 12 months.

The July numbers do not reflect credit market problems that accelerated this month, AIA Chief Economist Kermit Baker said. But credit market woes are not likely to have a wide impact in the coming months, he predicted, since the sector's fundamentals are strong and reflect broad business investment.

Rising defaults in subprime mortgages have made investors jittery in markets ranging from junks bonds to asset-backed commercial paper, making credit harder to come by globally.

"I think it's going to be pretty marginal," Baker said.

"There is some real concern about the credit markets, but when people step back, they'll say whatever the concerns are really has very little to do with nonresidential construction. I think it's going to be limited to housing."

U.S. spending on nonresidential buildings totals some $350 billion a year, according to Baker.

Companies that get a large portion of revenue from nonresidential construction include Acuity Brands Inc (AYI.N: Quote, Profile, Research), Genlyte Group Inc GLYT.O, Hubbell Inc (HUBa.N: Quote, Profile, Research), Thomas & Betts Corp (TNB.N: Quote, Profile, Research), Cooper Industries Ltd (CBE.N: Quote, Profile, Research) and Honeywell International Inc (HON.N: Quote, Profile, Research). (Reporting by Nick Zieminski and Dan Wilchins, editing by Jeffrey Benkoe)