Construction consortium
A consortium is a group of companies or other entities that come together to undertake one or more specific construction projects. They collaborate by pooling their resources, expertise, and capabilities, typically to deliver complex or large-scale projects that might be beyond the capacity of a single organisation. A consortium is formed to leverage the strengths of each member and is often used in large infrastructure projects, such as highways, railways, airports, and large public works, where multidisciplinary expertise and substantial resources are required. Forming a consortium allows companies to share resources and expertise, mitigate individual risks, and improve their chances of successfully delivering large and complex projects.
The members of a consortium share both the risks and the rewards associated with the project. This can include sharing costs, liabilities, and profits based on the terms agreed upon in the consortium agreement. Once the project is completed, the consortium may be dissolved, or its members might choose to collaborate on future projects.
A consortium can include a variety of participants such as construction companies, engineering firms, architects, financial institutions, and specialised subcontractors. This diversity allows the consortium to tackle different aspects of the project effectively. The collaboration is governed by a consortium agreement, which outlines the roles, responsibilities, contributions, and shares of each member. It also details how decisions are made, how profits and losses are distributed, and how disputes are resolved.
The legal structure of a consortium can vary. It can be a joint venture, a partnership, or another form of legal entity, depending on the preferences of the members and the requirements of the project.
The Code of Estimating Practice, seventh edition, published by the Chartered Institute of Building (CIOB) in 2009 suggests that a consortium is:
| The group of private sector participants who have come together for the purposes of tendering for a private finance initiative (PFI) contract. Also becomes a Special Purpose Company (SPC) or Special Purpose Vehicle (SPV). The generic term is project company, which is established by the preferred tenderer and is the contracting party for the project. |
NB Glossary of procurement terminology, A guide for suppliers, Published by the London Borough of Richmond upon Thames in April 2012, defines a consortium as: ‘An unincorporated group of firms or individuals, often formed to tender for a contract with a view to forming a company or working in some other way in the event of winning.’
[edit] Related articles on Designing Buildings
- Business model.
- Cartel.
- CIOB.
- Collusion.
- Company acquisitions in construction.
- Competition.
- Construction organisation design.
- Construction organisations and strategy.
- Contractor.
- Integrated project delivery (IPD).
- Joint venture.
- Partnering and joint ventures.
- Partnership.
- Private finance initiative
- Procurement.
- Special purpose vehicle.
- Types of construction organisations.
Featured articles and news
Key points for construction at a glance with industry reactions.
Functionality, visibility and sustainability
The simpler approach to specification.
Architects, architecture, buildings, and inspiration in film
The close ties between makers and the movies, with our long list of suggested viewing.
SELECT three-point plan for action issued to MSPs
Call for Scottish regulation, green skills and recognition of electrotechnical industry as part of a manifesto for Scottish Parliamentary elections.
UCEM becomes the University of the Built Environment
Major milestone in its 106-year history, follows recent merger with London School of Architecture (LSE).
Professional practical experience for Architects in training
The long process to transform the nature of education and professional practical experience in the Architecture profession following recent reports.
A people-first approach to retrofit
Moving away from the destructive paradigm of fabric-first.
International Electrician Day, 10 June 2025
Celebrating the role of electrical engineers from André-Marie Amperè, today and for the future.
New guide for clients launched at Houses of Parliament
'There has never been a more important time for clients to step up and ...ask the right questions'
The impact of recycled slate tiles
Innovation across the decades.
EPC changes for existing buildings
Changes and their context as the new RdSAP methodology comes into use from 15 June.
Skills England publishes Sector skills needs assessments
Priority areas relating to the built environment highlighted and described in brief.
BSRIA HVAC Market Watch - May 2025 Edition
Heat Pump Market Outlook: Policy, Performance & Refrigerant Trends for 2025–2028.
Committing to EDI in construction with CIOB
Built Environment professional bodies deepen commitment to EDI with two new signatories: CIAT and CICES.
Government Grenfell progress report at a glance
Line by line recomendation overview, with links to more details.
An engaging and lively review of his professional life.
Sustainable heating for listed buildings
A problem that needs to be approached intelligently.
50th Golden anniversary ECA Edmundson apprentice award
Deadline for entries has been extended to Friday 27 June, so don't miss out!
CIAT at the London Festival of Architecture
Designing for Everyone: Breaking Barriers in Inclusive Architecture.
Mixed reactions to apprenticeship and skills reform 2025
A 'welcome shift' for some and a 'backwards step' for others.