A leading Palestinian businessman is bidding to take over an ill-fated real-estate venture in an Arab neighborhood of East Jerusalem, upsetting Israeli settlers who are trying to put together a counteroffer, The Wall Street Journal reports.

Nof Tzion, Hebrew for Zion View, is a half-built project located in a mostly Arab neighborhood of East Jerusalem, marketed two years ago to wealthy U.S. Jews as a luxury residence with a panoramic vista of Jerusalem's Old City. Though the 91 units of the first phase of the development have been sold and occupied, Israeli developer Digal Investment & Holdings Ltd. couldn't complete the project or repay its bondholders, mostly Israeli institutions. Representatives of Digal weren't available to comment.

Jewish residents of the project are now livid at the idea that the project could be turned over to a Palestinian. The Palestinian businessman, Bashar Masri, said that if his bid is successful, he plans to offer houses in subsequent phases to Palestinians. His bid was discussed at a meeting of bondholders in Tel Aviv on Tuesday afternoon.

Read the entire story at wsj.com