The findings have prompted industry calls for the Victorian Government to build on the sector's strength by creating a more competitive environment to attract investment, support growth and unlock further economic opportunities.
The BDO research shows that Victoria is leading the charge with NSW, which generates $14.7 billion. In comparison, Queensland's retail property sector generates $9.8 billion, while South Australia generates $3.1 billion, The economic activity occurs in retail precincts through tenant operations, property operations, development and construction, and transaction-related activity.
Retail Property Australia Executive Director William Power said the findings should be a wake-up call for the Victorian Government.
"Victoria has a retail property sector worth billions to the state's economy, but we can't take that strength for granted.
"If the Victorian Government wants to attract more investment, support jobs and keep this sector growing, it needs to make Victoria a more competitive place to invest. That means addressing the tax settings that are making it harder to attract capital.
"Victoria should be building on the success of its retail property sector, not putting its future growth at risk through uncompetitive taxes.
"There are a myriad of taxes and levies unique to Victoria, including the Absentee Owner Surcharge and Windfall Gains Tax, that are putting a handbrake on investment. We need policy settings that attract international investment into Victoria's retail property sector and unlocking the capital necessary to support its next phase of growth."
Mr Power said the figures also highlight the strength of Victoria's fundamentals.
"Victoria has, in some ways, become the butt of a national joke when it comes to attracting investment. But these figures show that Victoria has the right economic fundamentals, and with the right tax settings, we have the potential to attract even more investment, create jobs and unlock the next phase of growth."
Nationally, the research finds retail property contributes $47.5 billion to the Australian economy and supports 239,000 full-time equivalent jobs. Victoria accounts for 26 per cent of that contribution, the second-largest share of any state or territory.
One Victorian centre was highlighted in the research. One Middle Road at Chadstone is a fully leased mixed use precinct driving activity, against Melbourne CBD office vacancy of about 19 per cent.
Across Australia, 62 per cent of the $436 billion in annual retail turnover flows through bricks and mortar retail property. The sector generates at least $11.9 billion a year in revenue for governments at every level, including $3 billion for state and territory governments.
