A guide to creating a joint venture consortium

The first meeting

Moving forward to the point where all the senior partner places have been filled, and monies can be released, by the stake holder, the next stage is to arrange the first meeting.

This meeting will require a firm chairman and you may find it helpful to bring in someone to handle this for you. If the chairman is not firm enough the meeting will go off the agenda, and not only will you not get the consortium established quickly but you may have problems with some members trying to renegotiate a special position, or change the constitution so it favours them.

The chairman can be one from a leading service provider who provides this service or you can do it yourself if you can convince PCI that you have the relevant experience and skill. If the project is being marketed through Self Build then they will cover this requirement, although you may still be present to meet the consortium members and participate if you wish.

At this first meeting the role of the consortium is reviewed and the progress made to date, provisional roles are allocated to senior partners, where each has specific objectives to work on. You will also schedule meetings with specific sub groups of them to provide additional advice, information, share research, handle transfers of assets and any other activities that are necessary. It is likely that you will need to become involved in some of these activities.

The only role at this point that is not allocated is that of chairman of the consortium, which is retained until we have everyone empowered or at least moving firmly in the direction of becoming empowered. This also gives the temporary chairman the opportunity to see who delivers and who is good at what. As soon as he is able and it could be within a couple of weeks, he will have another meeting with all the senior partners and at that time propose who he feels should be the initial chairman of the consortium, and ask the partners to support this. As he will have spent some time with each and they understand what he is doing and why, he should not have much difficulty with this.

The selection of a chairman is a key decision, the temporary chairman will want to propose a person who has taken on work and performed in line with what they have undertaken to do. He will need to be on his guard for the person who can talk well, but does very little or the consortium is likely to follow his example and becoming a  committee that achieves little. We also often find that a person who needs the support and help of others will make a better chairman than the person who feels they could really decide it all on their own.

Once a new chairman has taken over they then can delegate further tasks and between them they run the consortium and all parts of the project, from that point on you are not involved unless you have agreed to provide some additional support or training or are asked to  become involved. What you must never do is to become involved in any conflict or do anything that could cause friction within the group.

The main doorway site and exchange site for Property Club International is at www.property-club.org  
You may also like to visit www.property-club-international.org, it  contains a series
  of articles on joint venture consortiums and the organization behind them.