Executive Profile Like Fine Wine Charlie and Ed Shelton, united  in business if not politics, built careers on principles that have stood the test of time By Kevin Brafford

“We stay as busy as ever. Ed and I are constantly on the lookout for opportunities that suit us. We’re far from being done.” -- Charlie Shelton (right)

One prefers the beach, the other favors the mountains. One’s a Republican, the other’s a Democrat. One was prematurely gray before he reached middle age. The other’s hair remains predominantly black, belying his status as a senior citizen.

Charlie Shelton’s the silver-haired beachcomber who was campaign finance chair in Gov. Jim Martin’s successful re-election bid in 1988. Four years later, Ed Shelton, a reformed golfer with a fondness for Banner Elk, was likewise successful for Gov. Jim Hunt.

Truthfully, the Shelton brothers require no introduction in these pages. Anyone who’s conducted business in North Carolina for any length of time is aware of their decades of accomplishments. Their story is the stuff of which dreams are made and books are written.

The book came along in 1994, a few years after the brothers moved the corporate offices of The Shelton Companies from Winston-Salem to Charlotte. Working Together: The Sheltons of North Carolina detailed their rise to prominence from modest means growing up in Surry County.

But while Howard Covington and Marion Ellis’ entertaining read ended at 188 pages, the final chapters of the Shelton brothers’ life in business are still being written. They sold Shelco Inc., their general contracting firm, to a group of the company’s senior managers last Oct. 1, but still have their hands in a number of business ventures. Foremost is their highly regarded winery, Shelton Vineyards, founded in 1999 on 200 lush acres near Dobson.

“We stay as busy as ever,” says Charlie, who at 68 is five years older than his brother. “Ed and I are constantly on the lookout for opportunities that suit us. We’re far from being done.”

The Shelton family was entrenched in Surry County long before Charlie’s birth on Mother’s Day in 1935. Generations of Sheltons and Badgetts — the brothers’ mother was the former Bertha Badgett — had farmed the rolling hills. After Reid and Bertha Shelton married, Matt Shelton gave his son an adjacent lot.

Reid Shelton was a barber at a shop just three doors down from the Snappy Lunch, which would become famous decades later as the inspiration behind the Mayberry Diner on the Andy Griffith Show. On several occasions, in fact, Reid cut the hair of a teenaged Andy Griffith.

Working Together notes how excited Charlie was when Ed was born in the summer of 1940. “When they came home and told me I had a brother,” he says in the book, “I said, ‘I am so tickled about that that I could rub my hands off.’”

Charlie and Ed grew up working on their grandparents’ family farm. It was about a three-mile walk down a dirt road, but Charlie was known for finding shortcuts by cutting through Stewart’s Creek. “I was making 25 cents a day when I was eight or nine years old,” he says. “I got up to making 10 cents an hour when I was around 12, and that was big-time money. If you made $50 in the summer working in tobacco, you’d had a good summer.”

After several weeks of feeling weak and listless and having little appetite, Ed was diagnosed with ulcerated colitis in the summer of 1951. A rare condition in children, the illness kept him in the hospital for three weeks and housebound beyond that. He slowly regained his strength and by the following summer was earning his keep in the tobacco fields.

“The one thing you learned was that working in tobacco all of your life was not going to be an easy life,” Ed says. “It certainly helped with your motivation. Our parents helped, too. Our dad instilled in us a work ethic that helped shape us. He said that if you wanted to own a big car, work hard enough to make the money to buy it. He didn’t have any jealousy in his body for anybody.”

Charlie was influenced by another factor — the lingering effects of the Depression. “Our mother had 10 brothers and sisters in her family and they all lived close by, except for one, in Surry County,” he says. “Daddy’s brother lived next door to us, and our grandparents were close by. When they’d get together, you’d feel the negative feelings a lot of them had toward things. It caused me to want to see what was on the other side of the hill — I didn’t want to believe that the world was as bad as it was being made out to be.”

At age 12, Charlie planted his first “cash crop,” a field of cabbage. Three years later, he planted three acres of tobacco. He graduated from Franklin School — it was directly across the street from their house — and “my dad told me I needed to go to college. We decided I’d go to N.C. State and study textile engineering.”

The events of that summer changed his mind. Reid Shelton got his oldest son a job at the Mount Airy Knitting Mill. “I pushed cloth boxes in the mill the whole summer,” Charlie recalls.

“The windows were painted blue and I couldn’t see the sun. I decided right then and there that I didn’t want to be in textiles in any way.”

Charlie drove to Raleigh and got his deposit back from N.C. State. “I told my daddy that if he’d lend me $5,000, which is what it was going to cost to go to school, that I’d build myself a house — I already owned a little tract of land. Our grandfather had been a builder, and I really liked working with my hands.”

He went into business for himself for the first time when he and a former classmate, Dee Meadows, started Blue Ridge Enterprises in the fall of 1958. They built a makeshift office on the side porch of the Shelton’s home, and Charlie’s mom chipped in as time allowed, handling the two-way radio calls from the various job sites.

Like Charlie, college wasn’t for Ed. He attended Lees-McRae for a semester, then moved with a close friend, Tommy Hennis, to South Florida in search of fame and fortune. They didn’t find fortune in the few months they were there, but Ed had brief touches with fame when he would pick up singer Perry Como at the West Palm Beach airport in Como’s car and drive him home.

Back in Surry County, Charlie encouraged Ed to study for his real estate broker’s license. But there was a small roadblock — Ed was only 20 and the licensing board required him to be 21. So Charlie wrote a letter attesting to a personal bond until his younger brother came of age, and the board agreed.

Ed doesn’t profess to be great in remembering dates, but he well remembers Aug. 1, 1962. That was the night a friend set him up with Dotti McLaurine, a striking 22-year-old who worked in the business office at Baptist Hospital. “He was so cute,” Dotti says in Working Together. “He had a crooked little smile. I knew that I wanted to marry him (she didn’t share those sentiments that night) and I knew we would get married. He was very ambitious. He told me he wanted to be a millionaire before he was 25.”

They were married 10 weeks later and honeymooned for four days near Asheville before Ed went back to work. That December, he and Charlie went in business together for the first time, forming Fortis Enterprises. The name was Dotti’s idea; she had studied Latin in high school and remembered that “fortis” meant strength. Charlie and Ed built houses one at a time as money allowed, and they begged and borrowed and gradually made a success of the company.

“My wife kept the books for the first year,” says Ed. “We had a little basement office near Baptist Hospital. I think we built three houses the first year and about 15 the second year.”

At the request of a friend, Charlie spent parts of 1963 and 1964 managing a construction company in the Bahamas, leaving the daily operations of Fortis to Ed. But he never strayed too far from the company, and when he returned for good the two delved into their first big project. Colony West was a development on the west side of Winston-Salem, and construction on the first phase would eventually include 31 ranch and split-level houses.

“Charlie talked a man into selling us the land for nothing down, then we traded a lot or two to a grading contractor who put the streets and the water lines in,” Ed says. “We were in business basically with nothing down.”

That kept a bad situation from being catastrophic when the economy took a turn for the worse. Colony West was in dire straits, but the Sheltons refused to surrender. “I believe that you never give up,” Charlie says. “I never had before and I wasn’t about to then.”

Charlie visited bank after bank, and First National Bank of Mount Airy and NCNB agreed to a $40,000 loan — with one stipulation: Reid Shelton had to sign for the note. He did, and the Sheltons were liquid again. The loan helped satisfy some of their obligations, and Charlie and Ed negotiated non-cash settlements with some of their subcontractors to satisfy the rest.

With each step they learned something about their business. They already had broken with traditional construction companies by hiring subcontractors for specific jobs in house building rather than employing large crews of their own. Charlie and Ed treated their subcontractors well, maintaining close contact and paying them promptly to keep jobs on schedule.

It’s said that those who make the most spend the least when it comes to money, and Charlie was that way when it came to business. In Working Together, Betty Baker, Fortis’ first bookkeeper, remembers Charlie ordering her to turn adding machine tapes over to use their reverse sides.

At age 32, Charlie, heretofore a confirmed bachelor — when you’re working 14 hours a day, who has time to date? — met the woman of his dreams. Sandy Graham was a petite graduate student at Appalachian State Teachers College in the spring of 1966 and the daughter of the sheriff of Surry County.

They tied the knot on the last day of 1966 at First Methodist Church in Kernersville and after a short honeymoon in the Bahamas, she returned to school and he to work. They moved their belongings to one of the unsold houses at Colony West, where they lived just around the block from Ed and Dotti.

Much of the brothers’ energy turned to a new project, the Yorktown subdivision in Kernersville. But after a promising start, a series of bad breaks, coupled with a slow economy, left them will a pile of bills. In the fall of 1967, Ed wasn’t surprised when he took a call from Northwestern Bank. A $250,000 note was due.

“They wanted to foreclose,” Charlie remembers. “We told them that we could save them a lot of money, that if they would just send over some deeds we’d give the property to them and save all that legal work of foreclosing. On the other hand, if they saw fit to give us a little more money to keep us alive, we’d try to keep both of us out of trouble. And since the last thing they wanted at the time was real estate, they extended our line of credit.”

Near the end of the decade, Fortis took off. “We developed a process of building starter homes efficiently,” Ed says. “Instead of running the houses through an assembly line, we were running the assembly line by the house.”

In short, the Sheltons streamlined the process. Framing lumber was pre-cut. After the members for a wall had been cut, they were wrapped in a steel band and stacked in bins along with other parts for a particular model home. Every major piece was pre-cut, lowering waste and raising efficiency. Houses sold for $12,000, providing a profit margin of nearly 25 percent.

Feeling they had maximized their growth potential as a small company, the Sheltons sold Fortis in 1971 to Daniel International, a hugely successful construction and development company based in Greenville, S.C. “We needed more capital to grow the business,” Charlie says, “and we agreed that was the way to go. We were able to keep our name and Ed and I still ran the company. That was part of the deal.”

The following year Fortis showed a 90 percent profit over projections. One year later, the company built 750 houses. A downturn in the economy had lowered that number by more than 60 percent two years later, but the Sheltons had anticipated the movement and streamlined the company’s payroll.

Things moved smoothly for a while, but by 1977 the relationship between Fortis and its parent company was strained, thanks largely to in-fighting among the latter’s upper management. It got so bad that Charlie resigned, effective April 1 of that year, with the knowledge that Ed would soon follow.

One month later, news leaked that the company’s majority stockholders had agreed to sell Daniel to Fluor Corp., a worldwide petro-chemical engineering firm headquartered in Los Angeles.

The Sheltons sold their stock the day prior to Fluor’s final offer, but their sales price was within 50 cents of the final amount. The math worked this way: Charlie and Ed sold 135,649 shares for $4,158,998 — almost $4 million more than the $167,000 they had invested through the years. “We sensed it was the best thing for us to do at the time,” Charlie says, “and we were right. The sale gave us capital to grow a business as we saw fit.”

As has always been their wont, the brothers shared their good fortune. Before selling the stock, the brothers earmarked 19,358 shares valued at $593,516 to numerous projects in the King community, with more than half put toward a new building at King Elementary School that would be used as a combination gym, auditorium and lunchroom.

Just after Labor Day, Ed resigned from Fortis and joined Charlie in their newest venture, Shelco. A couple of months later, they were enjoying their annual holiday lunch with Jimmy Dew and Bill Simpson, who owned RMIC, a mortgage insurance company. “They said that they had to have a new office,” says Charlie. “I kicked Ed under the table and said, ‘Don’t you know that’s the business we’re in?’”

“Charlie kicking me under the table was the sign for me to keep my mouth shut,” Ed says. “He wanted me to follow his lead.”

That marked the beginning of the Sheltons’ real estate development business. They built an office for RMIC and soon had earned a reputation as the hot builder in Winston-Salem. Republic Square and Madison Park were two major developments that extended the city’s boundaries with regard to corporate business and housed blue-chip companies such as Sara Lee Corp., Piedmont Airlines and Xerox.

At one time or another, the brothers had their hands in most every business venture of note in Winston-Salem. They were instrumental in the rebirth of the Stevens Center, owned restaurants, took active roles in the chamber of commerce, and helped raise millions for Wake Forest University, their adopted college. They also were a driving force behind the creation of Winston-Salem Business Inc., the city’s economic development arm.

There are thousands of homes and office sites in Forsyth County that bear Charlie’s fingerprints, but the county perhaps will most remember him for a construction that didn’t involve a single piece of lumber. In 1985, he was appointed to the board of the state Department of Transportation. His connections and dogged determination helped generate more road-building money for Forsyth than in the four years that followed than had been raised in decades.

He resigned from the board on Oct. 1, 1990, less than a year after the bids had been awarded for construction of the final section of an I-40 bypass. It was his crowning achievement, providing safe travel around the city and relieving congestion on old I-40, the most traveled and dangerous interstate segment in the state. It involved big money — the total cost of the project was $142.5 million, or about $6.5 million per mile — but it was needed. “It was essential to Winston-Salem’s growth,” Charlie says.

By 1988, the Sheltons had shut down most of their development business and were looking for contract business. In 1991, they moved their corporate headquarters and 100 employees to Charlotte. One of their first hires in the Queen City was Hugh McColl III, son of the chair and CEO of NationsBank. “We felt like we had reached our potential in Winston-Salem,” Ed says. “We were subcontracting out about $50 million in business a year, and we wanted to grow that. Being close to the banking centers, where we could act quickly, made sense.”

The management of Shelco had been turned over to a group headed by Ed Rose, who had started with the company in 1983 as a project manager. Charlie and Ed were free to delve into any venture that struck their fancy, and by 1998 their fancy no longer included real estate. There was one exception, however, an old dairy farm in Surry County that caught Charlie’s eye.

“I paid $1,600 an acre” Charlie says. “Three days later, I told Ed about it. At the time I just wanted a piece of land to get out and walk around on once in a while. We gave the use of the land to the local farm community for hay.

“Then one day I told Ed that I’d like to try a little bit of vineyard up there on the property. He said he didn’t want to have anything to do with it, so I decided that I’d fool around with about 20 acres. Then he tells me that if I want to do 50 acres and build a pretty entrance, he might be interested.”

And build a pretty entrance the Sheltons did. A long, winding drive flanked by more than 300 rose bushes at the end of every vineyard row leads to the winery. Fourteen varieties of grapes are grown, and they are handpicked by hand in mid-to-late August.

After aging in barrels the wine is bottled — state-of-the-art equipment allows for 52 bottles of wine to be filled per minute. They are released for sale only after a period of bottle aging appropriate to the wine. “We started selling the first wine we produced in 2001,” Charlie says, “and in two years time we annualized it at 18,000 cases a year.

“Our promise has been to only sell good wine with our label on it. We probably won’t sell our 2003 vintage of red ourselves because it contained too much water. Instead, we’ll end up selling it in the bulk market.”

The brothers spend a couple of days a week at Shelton Vineyards and their remaining time in their offices near SouthPark, their eye always on the next great venture. They could have profited more from shopping Shelco on the open market, but that’s not their style. “That’s the last thing we wanted,” Ed says. “We’ve got about 250 employees who have worked hard for us and helped make this company, so they should have some fun with it like we did.”

The brothers don’t confess to many hobbies, save for three or four weekends a year when they take part in a friendly poker game. Family time is special, whether it’s Ed and Dotti gathering at Elk River with their three daughters, their spouses and four grandchildren, or Charlie and Sandy at Hilton Head with their son and daughter, their spouses and four grandchildren. The only one who doesn’t live in Charlotte is a daughter of Ed’s who teaches in Atlanta.

“Charlie likes watching the sun come up and I like watching it set,” Ed says. Most of the hours in between, whether they’re in Charlotte, Surry County or visiting their respective second homes, is still business as usual.