Due to special characteristics of Public Private Partnerships (PPPs), the ―transaction cost‖ in PPPs is more than other delivery methods. Although there have been some attempts to study transaction costs in PPPs in Europe, transaction costs of PPPs in the US has not been explored well, and the need to develop a standard cost breakdown structure to track, measure and estimate transaction costs in PPP projects is paramount. This thesis covers a theoretical discussion about the definition of transaction costs and different factors affecting them, and based on the mapping of PPP transaction activities to project costs, presents a cost breakdown structure (CBS) as well as a cost accounting matrix. This accounting model is justified in chapter four using two case studies: I-495 HOT lanes project in Virginia, and I-595 improvements in Florida. Finally, in chapter 5 a template for an estimating model which can be used in procurement transaction cost estimates is developed based on the data collected from some infrastructure PPP projects in Europe, and applying Bayesian theory.