Israel gave approval Wednesday for the construction of 172 new homes in annexed East Jerusalem, a city councilor said, nearly two weeks after it announced thousands.

“The municipality approved this morning the construction of 172 apartments in Har Homa,” Jerusalem city councilor Yosef Pepe Alalu of the left-wing Meretz party, told AFP.

“This is the final stage before construction, and is the continuation of a policy that harms the peace process.”

Israel unveiled plans on June 5 for 3,200 homes in East Jerusalem and the West Bank, in retaliation for the formation of a Palestinian unity government backed by the Jewish state’s foe Hamas.

That announcement drew furious reaction from the Palestinians and the international community, with UN chief Ban Ki-moon saying he was “deeply concerned” and urging Israel to freeze its settlement activity.

Israel captured East Jerusalem in the 1967 war and annexed it, and does not consider building there to be settlement activity. The international community does not recognize the Israeli annexation, although Australia recently declared that it would no longer brand East Jerusalem “occupied” territory.

Wednesday’s approval came as Israel was engaged in a huge crackdown on Hamas, accusing the Islamist movement of being behind the kidnapping of three Israeli teenagers in the West Bank on Thursday night.

Prime Minister Benjamin Netanyahu has urged the international community to press Palestinian Authority President Mahmoud Abbas to end his reconciliation deal with Hamas, citing the kidnapping as proof the movement’s terrorist activities make it an unsuitable political partner.

Israel’s settlement building is widely viewed as a key obstacle to a peace deal with the Palestinians.

When nine months of US-backed peace talks collapsed in April, officials in Washington placed a portion of the blame on Israel pushing through plans for thousands of settler homes during negotiations.

The Palestinians have pledged to seek an anti-settlement resolution at the UN Security Council for the first time in more than three years.

Times of Israel staff contributed to this article.