JERUSALEM (JTA) — Israeli Prime Minister Benjamin Netanyahu has rejected an Obama administration call for a total construction freeze in eastern Jerusalem, the Wall Street Journal reported.

The rejection was conveyed last weekend by Israeli officials to White House officials, the newspaper reported in an article published Thursday.

The Prime Minister’s Office on Thursday confirmed the Wall Street Journal report, which was based on Washington diplomatic sources, Israeli media reported.

But Netanyahu did agree to undertake confidence-building measures towards the Palestinians, according to the newspaper, including allowing the opening of Palestinian Authority institutions in eastern Jerusalem, turning over more West Bank land to Palestinian security control and discussing core issues such as permanent borders and the status of Jerusalem during indirect peace talks instead of waiting for direct negotiations.

The newspaper reported that U.S. officials said the refusal to freeze construction in all of eastern Jerusalem could be a barrier to starting new negotiations with the Palestinians, and that some of the concessions offered by Israel are "nearly identical" to a list Israel has offered to the White House twice before in recent months but has not implemented.

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