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Three days after the U.S. administration criticized the decision of Prime Minister Benjamin Netanyahu to authorize the construction of hundreds of new housing units in settlements, the Israel Lands Administration published tenders for the construction of 486 apartments in the neighborhood of Pisgat Ze'ev in East Jerusalem.

The new construction project is designated for the outer edge of the northeastern municipal boundary of Jerusalem, and will narrow the distance between the homes on the edge of the neighborhood and the nearby Palestinian communities. Bids have been solicited for construction on an overall area of 138 dunams (about 34 acres), which was subdivided into 25 smaller tenders.

The Obama administration has made it clear on a number of occasions that it is demanding that Israel freeze settlement construction in the territories, including in East Jerusalem. Two months ago, it was reported that Netanyahu had ordered a delay in the publication of the tenders.

In October 2008, the ILA canceled the tenders, arguing that the bids received from developers were too low compared to the value of the land. Then, last month, Haaretz-TheMarker reported that the tenders would be reissued after an appeal by contractors had led to the conclusion that the official assessment of the land value had been excessively high.

Officials at the Ministry of Housing and Construction said at the time that they would offer or development more land in the neighborhood so as to lower the price of apartments in the area.

Daniel Seidemann, the founder of Ir Amim, a non-profit organization that seeks to promote coexistence in Jerusalem, said last night that tenders of such magnitude would not be announced if they did not have the support of the prime minister. Seidemann describes the bid-taking as yet another example of a fraud that leads to creating facts on the ground even though there is talk of a freeze in settlement construction.

According to the ILA: "The tender was issued with the approval of minister of housing, and there was no additional approval needed at the political level. It is a tender that had been published last year in October and, for technical reasons, so far only two of the 25 plots had been sold."

Meanwhile, a source familiar with the exchanges between Israel and the U.S. on the issue of a settlement freeze told Haaretz that the Obama administration is not interested in a crisis with the government of Netanyahu on settlements.