Big weddings and honeymoons in Vegas made the headlines in 2004. People splurged on luxury items (a $10 million zeppelin from Neiman Marcus?) but were stingy with carbohydrates. Retailers and real estate execs joined the jet set, with trips to India and China becoming routine. And developers brought property — lots of property.

It's time for our annual “Hot and Not” feature, detailing the rise and fall of industry icons and trends. The biggest Hot (Or was it a Not?): Kmart Holding Corp.'s purchase of Sears, Roebuck and Co.

General Growth Properties Inc. acquired The Rouse Co. in the largest REIT merger ever, putting General Growth on par with longtime industry leader Simon Property Group. A series of other marriages consolidated the number of players and put a large percentage of retail property into the hands of a few of the biggest companies.

We also saw the rise of tenant-in-common investments (see story on page 44), which gave REITs even more competition for the limited real estate available. And we witnessed cap rates fall to previously unheard of lows: less than 6 percent. That pattern did not abate even in face of the first rate hikes in three years by Federal Reserve Chairman Alan Greenspan.

Las Vegas was sizzling. The Forum Shops, Desert Passage, the Canal Shoppes and Fashion Show Mall were all at the center of acquisitions or redevelopments. And more big retail should be on the way with another wave of mega-casino projects in the works.

And what of the dwindling anchors? Did the Kmart/Sears deal signal, once and for all, the long-predicted death of department stores.

Wal-Mart Stores Inc. moved imperiously forward, striking fear in the hearts of competitors, and some neighborhood residents, as it cut a wide swath across the country. First, it devastated other discounters. Then it started destroying grocery stores. Now, it's the top toy peddler in the nation, putting chains like KB Toys and Toys ‘R’ Us at risk.

We also saw how devastating Mother Nature can be. Florida got hammered by four hurricanes, forcing retailers and owners to regroup again and again. Rising gas prices hurt consumer spending, especially at dollar stores and discount retailers.

While the wealthy bought all manner of jets and jewels, the thrifty cut out their Starbucks fix for the much cheaper Dunkin Donuts lattes and cappuccinos. Krispy Kreme fell victim to the low-carb craze.

In the pages that follow we've tried to capture a cross section of this year's important and quirky stories. Enjoy.

H It's a Small World

Developers and retailers became Citizens of the World. Mills Corp., Simon Property Group and Taubman Centers followed the money to Europe, Asia and Latin America, while foreign investors as well as European retailers H&M, Zara and Mango looked for comfy spots in the U.S. Westfield Group combined its worldwide units. In November Developers Diversified bought a $1.15 billion Puerto Rican portfolio and entered a $204 million venture with Mideast investors.

P Tying the Knot

General Growth Properties Trust and Rouse Co;. Developers Diversified Realty Trust and Benderson Development Co.; Simon Property Group and Chelsea Property Group; Kmart Holding Corp. and Sears, Roebuck and Co. Everywhere you looked in 2004 there was a huge merger. REITs have been big consolidators for a while, but the General Growth/Rouse deal blew the doors off everything that had come before. It was the biggest real estate merger ever. However, with so many big buys in the books, many are expecting things to slow in 2005. On the retal front, the Kmart/Sears transaction could be just the beginning, and could set off a string of department store deals. Consolidation may also extend to other sectors — such as office supplies. And the really big question is how will Wal-Mart answer a new threat?

Resource Wars P

Every year it gets harder to find greenfield sites for new regional malls. So, increasingly, developers are resorting to legal fisticuffs when good locations become available or competitors try to move in on another's turf. The most spectacular fight is the ongoing tug-of-war between Mills Corp. and Hartz Mountain Industries over the Meadowlands Sports Complex property on which Mills is slated to build Xanadu. Examples are plentiful: Caruso vs. General Growth in California, for instance, and Simon Property Group vs. Taubman Centers on Long Island. Look for more bouts in ‘05.

TIC Tactics

Small investors are pooling their resources to buy bigger properties through use of tenant-in-common structures. This year witnessed the second-largest TIC investment ever in the retail industry when a group of 32 individuals came together to buy the Village at Orange (in California) for $100 million. Use of the TIC structure is more prevalent on the West Coast, but as they build a good track record, experts expect such ventures to become widespread. TICs spent about $200 million on retail in 2004. That's a drop in the bucket compared with what some REITs spent. But analysts think TICs will soon be a trillion dollar industry.

P Viva Las Vegas

Sin City has developers drooling, because centers there rank among the highest nationally in sales per square foot. The year kicked off with Trizec Properties' sale of Desert Passage to RFR Holding and Sutton East. General Growth Properties scored the Fashion Show Mall and the Grand Canal Shoppes at the Venetian Casino in separate deals. And Simon Property Group expanded the Forum Shops, the nation's highest grossing retail property. With even more mega casinos on the drawing boards, you can expect more deals and more high-profile developments to open on the Strip.

H Depot Depression

Office Depot rolled out a new layout for its stores this year, but that didn't help revive the firm's floundering fortunes. The chain is cutting 1,700 jobs, paying down $250 million of debt and swallowing other charges worth $55.5 million. Its main competitor, Staples Inc., meanwhile, has proven more efficient and innovative. It has also remodeled its stores, and introduced a line of “smart” products under its own brand name. The firms are planning to take their competition to Europe in 2005.

Retailers Flunk Back-to-School Sales

August sales were weak across the board this year, which retailers blamed in part on adverse weather — as in Florida hurricanes and unseasonably warm temps in the Midwest — as well as a late Labor Day and consumer frugality. Taking into account all these factors, August same-store sales dropped 2 percent from a year earlier. Wal-Mart exemplified the struggles, with same-store sales up just 0.5 percent from the previous year — a tiny increase for the consistently improving sales machine. Disappointing back-to-school sales led many retailers to cut third-quarter earning projections.

Q No Time for Play

Wal-Mart's rise to the top of the U.S. toy market was just the latest blow to struggling chains Toys ‘R’ Us, FAO Schwarz and KB Toys. Toys ‘R’ Us — now No. 2 — is rumored to be planning the closure of several hundred stores in 2005. Both FAO and KB have filed for bankruptcy. But wait, Target is rapidly making headway in the sector. Could the dominance of superstores in this sandbox mean the demise of stores that sell only toys? Or will the traditional players find a way to fight back against these schoolyard bullies? Stay tuned.

Krumbling Kreme? P

A few years ago, consumers and retail owners alike could not seem to get enough of the suddenly scorching Krispy Kremes. After decades of success as a Southern chain, the doughnut maker went national and conducted a wildly popular IPO. But it appears to have been a case of too-much too-fast. The rise of the Atkins and South Beach diets didn't help. Carb cutters avoided the fat-laden treats like the plague.

H Mother Nature Gets Ferocious

Every year has its share of natural disasters, but nobody had seen anything like what Florida experienced in 2004. In a matter of weeks, four hurricanes battered every part of the state, forcing developers and retailers to regroup time and again. Tornados and floods followed, causing inestimable damage to developers and retailers Perhaps hardest hit, grocery stores that had to toss out merchandise that couldn't be refrigerated when the electricity went out.

P Card Me

This year's hot Christmas item may not be the latest gadget or clothes from the hottest designer. Instead, it just might be a little piece of plastic. Gift cards have been around for a few years now, but retailers are jazzing up their offerings (and improving the underlying technology) to make the items more appealing. JCPenney, for example, has introduced plush card holders that can be tucked inside a stuffed animal. Nationally, holiday gift card usage could reach $22 billion this year, about 10 percent of the National Retail Federation's holiday projection.

How Low is My Cap Rate?

A few years ago when regional mall sales first dipped under 8 percent cap rates, industry observers tensed up. Today, those same folks must be positively apoplectic as every big deal brings with it record low cap rates. The most recent deals have seen rates drop below 6 percent, even as interest rates have begun to rise. The trend has led some developers to conclude that these high prices are the new norms. So those sitting around waiting for bargains may be out of luck.

H China Syndrome

Tentative first steps by retailers into the fastest-growing economy in the world has left many chains asking for more. Wal-Mart already has made inroads into the country, whose $1.6 trillion economy trails only the United States. Retailers are encouraged by recent policy changes that make it easier for foreign companies to enter the world's most populous country.

P Oh, the Humanity

Play it safe this time with your very own nonflammable blimp. Price? A mere $10 million. The roomy cabin can comfortably seat 15. And with its lightweight aluminum and carbon-fiber network, it takes off and lands easily — like a helicopter. Available through Neiman Marcus, which is proving yet again with early success to its fantasmagorical Christmas catalog that in a time of consumer restraint, the rich are different than you and I.

Q La Vida Loca

She's the hispanic Martha Stewart. But while Stewart's serving time, Kmart spokeswoman Thalia Sodi (left) is living the life. The Mexican singer is one of a growing number of Latinas representing retailers. Sears, now Kmart's partner, also appreciates the buying power of Latinas, who spent an estimated $6.6 billion on clothes in 2004. It's launching a line named for Cuban American TV star Lucy Pereda.

The Poor Man's Starbucks P

While competitor Krispy Kreme has struggled in the new low-carb environment, Dunkin Donuts is growing faster and faster. Once known mostly for its “munchkins” and doughy treats, the chain's newfound popularity stems from its luscious lattes and other coffee delights. Its brew is much cheaper (and, most would argue, much less pretentious) than Starbucks' offerings. The popularity has led to a run of new store openings.

Knock it Off R

Retailers and designers are up in arms about counterfeit purses and other fake goods being sold not just on the streets of New York but in London stores, where Abercrombie & Fitch Tees were flying off the shelves of nine retailers. The National Intellectual Property Rights Coordination Center estimates that 5 percent to 8 percent of all goods sold worldwide are counterfeit, hitting the apparel industry where it hurts — right on the bottom line.

Q It's in the Can

With gas prices in the U.S. hovering near $2 a gallon and heating oil near record highs, consumers — especially on the low end of the buying spectrum — have had to cut back on spending. This phenomenon has hurt the dollar stores the most, with that sector's performance lagging the broader retail industry. Paying winter heating bills won't be fun.

Oy Vey P

Call it the deli wars. Jewel-Osco, a unit of Albertson's, has pitted rabbi against rabbi in its decision to open kosher stores-within-stores at several Chicago-area locations. It seemed like a good idea to the Orthodox Union, whose rabbis would certify that the meat, fish and bakery items met the strict dietary laws. But then Jewel set up a Kosher Marketplace only a matzah-ball's throw away from several mom-and-pop butchers and bakeries that immediately started losing business. Jewel said it meant well and that the strategy was part of a national plan to cater to residents in ethnic neighborhoods. It's a case of the big fish swallowing the little fish, said one local merchant, praying for a Wal-Mart to take a bite out of Jewel.

Wal-Mart Woes P

From South Park to PBS to community groups to feature films, Wal-Mart is the retailer everyone loves to hate. The low pay, sexual harassment charges and the death-to-mom-and-pop stores culture has created a backlash for the world's largest retailer. In April, voters in Inglewood, Calif. rejected a Wal-Mart sponsored initiative that would have allowed the behemoth to build a store in the L.A. suburb — a blow to the giant's plans to open 40 supercenters in California. “They're rolling back prices, rolling back competition and rolling jobs overseas,” PBS's Frontline said in a promotion for its November show: “Is Wal-Mart Good for America?”

All Wet

Youth-oriented apparel chain Wet Seal is drowning in red ink. The company has posted several straight quarters of losses. Most recently its drop amounted to $102.8 million. The firm has admitted that Chapter 11 bankruptcy protection is an option. Difficulties at the chain have led to the resignation of former chairman and CEO Peter Whitford. The chain, which only a couple of years ago looked like a hot up-and-comer, has instead steadily lost market share to competitors such as Pacific Sunwear, which is sizzling. The teen clothing retailer reported a 30 percent jump in third-quarter earnings. Pacific Sunwear is hot; Wet Seal is not.