JERUSALEM - Bulldozers demolished a hotel in Jerusalem Sunday to make way for a new Israeli enclave in the heart of a Palestinian neighbourhood, moving ahead with a plan that has angered the Palestinians and the U.S.
The Shepherd Hotel, purchased by a Jewish American millionaire in 1985 and empty for years, is to be replaced by 20 apartments for Israelis. Workmen and earth-moving equipment were knocking down the structure in the neighbourhood of Sheikh Jarrah, a frequent flashpoint for Palestinian protests against Israeli policies.
The hotel, Arab-owned before 1967, became the property of the Israeli government after Israel captured east Jerusalem in that year's Mideast war.
Nearly two decades later, the building was sold to Jewish American businessman Irving Moskowitz, a longtime patron of Jewish settlers. In 2009, after years of bureaucratic stalling, the Jerusalem municipality issued permits for construction.
Peace talks are currently stuck over Israeli construction in east Jerusalem, which the Palestinians claim as their future capital. The Palestinians say they will not renew talks without an Israeli settlement freeze that includes east Jerusalem as well as the West Bank, which also was captured in 1967.
Chief Palestinian negotiator Saeb Erekat condemned the project. "As long as this government continues with settlement and acts like the demolition of the Shepherd Hotel there will be no negotiations," he said.
Israel says it has the right to build anywhere in the city, including east Jerusalem, which it annexed in a move that has not been internationally recognized. Officials also note the Shepherd Hotel project is private and the property was purchased in line with Israeli law.
"This project has nothing to do with protesting or provoking, or to do anything except provide more apartments for Jews to stay and to live in Jerusalem," said Elisha Peleg, a Jerusalem City Council member and one of the project's backers, at the site Sunday.
Peleg said there were 50 more apartments in the planning stages for the hotel compound, for a total of 70 housing units.
Israeli and Palestinian envoys are heading to Washington this week in an attempt to move stalled talks forward, but the Palestinians say the envoys will not talk directly to each other.
Mark Regev, an Israeli government spokesman, refused to discuss the Shepherd Hotel project but called on the Palestinians to return to talks.
A small number of neighbourhood residents and onlookers watched the bulldozers work Sunday.
"They have no right to anything here," said Inas al-Ghawi, 38. "This is Palestinian land, but they are thieves, they steal everything."
The people behind the project "want to settle here and make the situation in Jerusalem even more problematic than it is now," said Mossi Raz, an Israeli peace activist and former lawmaker.
In recent years, settler groups have been moving more Israeli families into Palestinian neighbourhoods in east Jerusalem, attempting to ensure the city will not be divided in a future peace deal.
Several thousand settlers now live under heavy guard in Arab neighbourhoods of the city. Their presence has led to rising tensions in those areas.
Another enclave in the same Sheikh Jarrah neighbourhood -- where several Palestinian families were evicted by court order after their homes were deemed by an Israeli court to be Israeli-owned -- has become the scene of a weekly protest by Palestinians and Israelis who oppose the government's policies in Jerusalem.
Since capturing east Jerusalem, Israel has built large Jewish neighbourhoods there that are now home to 200,000 people, more than a quarter of the city's population. The Palestinians consider those neighbourhoods illegal settlements. An additional 300,000 Israelis live in the city's western sector. About 250,000 Palestinians live in east Jerusalem.
