Another busy year for the erector set.

• Position: Charlotte, North Carolina's commercial construction - Industry Overview

Charlotte contractor Shelco Inc. came off its best year ever in 1996, wondering what it would do for an encore. It had landed $271 million in contracts, most notably the 10-story Transamerica building in downtown Charlotte, and then a 15-story NationsBank tower nearby.

No problem. Shelco executives say their 1997 total, once it's tallied up, could be just as high. That's largely due to a huge First Union contract. In the fall, the bank started clearing a place in Charlotte's downtown skyline for a 29-story, 900,000-square-foot office tower. "You hear that there may be a slowdown, but projects keep happening," says Ike Grainger, Shelco's vice president of business development.

Downtown Charlotte wasn't the only busy place. Carolinas Associated General Contractors says the nonresidential work it tracks done by its members, not counting infrastructure jobs, was up 39% through August in North Carolina. Highway jobs were up even more. Federal projects rose 162% in the first six months, while other highway work was up 29%.

Time to oil up the construction cranes, right? Maybe not. The past few years offer a perfect backdrop for speculative overbuilding. "The good news is that we have a strong economy," says Eric Karnes, president of Karnes Research Co., a real-estate analysis outfit in Cary. "The bad news is that everybody knows it."

So far, despite all the activity, there are few signs of overconstruction. For one thing, the government sector is keeping many contractors busy with jobs paid for through public sources. In November 1996, Tar Heel voters passed a $950 million road bond.

The two biggest worries facing road contractors are finding skilled labor and beating back out-of-state contractors trying to snatch the jobs. "There should be plenty of work for a minimum of a three-year period and probably over the next five years," says Ron Shaw, vice president of Lee Construction Co., a Charlotte highway contractor.

In the Triangle, spending for public projects has been particularly brisk. A few of the largest projects under way in 1997: a $232 million, 1 million-square-foot central research facility for the Environmental Protection Agency in Research Triangle Park; a $120 million, 22,000-seat arena in Raleigh; a $47 million N.C. Museum of Natural Sciences building in downtown Raleigh; and a $30 million children's museum, also in Raleigh.

The retail sector is a question mark. The wave of big-box shopping centers, which were all the rage in the...