Israel reissued Tuesday a call for tenders for homes in East Jerusalem, in a move that could hike tensions as Washington struggles to salvage crisis-hit peace talks

The Israel Lands Authority issued the tenders for living units in the Gilo neighborhood of the capital, which is located beyond the 1967 lines and was annexed by Israel.

Peace Now’s Hagit Ofran confirmed the tenders were for 708 homes in Gilo, saying “the Housing Ministry is trying to forcefully undermine the peace process… and [US Secretary of State] John Kerry’s efforts to promote it.

“This morning, the Israel Land Authority announced this project, which is actually a renewed tender which was published (in two parts) last year but found no bidders,” she told AFP.

Army Radio, which first reported the news, said the tenders had been reissued under conditions significantly better than last year, making it more likely they would be taken up.

The tenders were first issued six months ago but had no takers from contractors.

Israeli NGO Ir Amim, which supports an “equitable” sharing of Jerusalem between Jews and Arabs, described the tenders as “a poke in the eye of both the Palestinians and the Americans,” the radio said.

The development came amid intensive efforts to keep afloat the foundering talks between Israel, the Palestinians. Among the chief demands by Palestinians is a halt to construction in the West Bank and East Jerusalem.