Amid a slumping national housing market, KB Home is dropping its plans to build about 12,000 homes on 3,000 acres of farmland west of New Orleans.

The Los Angeles-based homebuilder decided to forego the project in an area called Waggaman by letting the expiration date on its option to purchase the land run out 30 days ago, according to news reports.

However, KB’s partner in the project, Baton Rouge-based Shaw Group Inc., may acquire a smaller parcel of land from the owner.

KB Home was one of the first major homebuilders to move into the New Orleans market after Hurricane Katrina. The company initially planned to build condominiums, town homes, single-family homes and retail stores on the property.

The company maintained it still has an interest in the area where it has purchased other property, but it has given no timetable or details about any development.

Shares in KB Home were up 4 cents to $51.60 in early trading Friday.