During nine fruitless months of U.S.-mediated talks between Palestinians and Israelis, a record-setting Israeli settlement campaign in the occupied West Bank and East Jerusalem unfolded, according to a report published Tuesday by Israeli monitoring group Peace Now.

The report, released as the deadline passed for the two sides to reach a framework agreement and extend talks, said the Israeli government promoted plans or approved tenders for nearly 14,000 new settler homes on occupied Palestinian land in the West Bank. The scale of plans for East Jerusalem and the West Bank was “unprecedented,” with Prime Minister Benjamin Netanyahu’s government approving the equivalent of about 50 new homes a day, the group said.

All Israeli settlements in the West Bank, East Jerusalem and other territories occupied since the Six Day War in 1967 are illegal under international law. Palestinians have repeatedly called for Israel to freeze settlement activities as a precondition to talks, arguing that negotiations about the borders of a potential Palestinian state were futile so long as Israel continued to infringe on Palestinian territory.

Israel aborted the latest effort to bridge gaps between Israelis and Palestinians after Fatah, which runs the West Bank, announced a unity government with Hamas, which controls the Gaza Strip and is designated a “terrorist” organization by Israel, the U.S. and the EU.

The Israeli settlement binge will likely fuel Palestinian accusations that Israel was using peace talks as cover to create “facts on the ground” in the West Bank in anticipation of future border negotiations.

“Israel is the only country in the world that does not declare its borders and keeps them open to expansion,” said Mustafa Barghouthi, secretary-general of the Palestinian National Initiative, in a conference call with reporters on Tuesday. “If Israel is allowed to continue building settlements, it kills the two-state solution.”

For his part, Netanyahu has pinned blame for the failed talks on the unity agreement between Fatah and Hamas, which refuses to condemn violence or recognize the state of Israel. He has said Palestinian president Mahmoud Abbas could make peace with Hamas or with Israel — but not both.

On Tuesday, a senior Hamas official told Reuters that his group would not change its mind about recognizing Israel, and noted that he was still waiting for Abbas to assemble a mutually agreeable unity government of technocrats to represent the Palestinians. The last unity government between Fatah and Hamas collapsed in 2007, and two subsequent attempts to unify ended in failure.

Of foremost concern to Abbas is whether unity with Hamas will jeopardize financial support from the U.S. — which has preconditioned aid to the Palestinian government on agreements reached between the Palestine Liberation Organization (PLO), the body empowered to negotiate on behalf of Palestinians, and Israel.

Under the Fatah-Hamas deal, the PLO would be reconstructed to potentially include Hamas, which has opposed the peace process from the very start. Nevertheless, PLO leaders say their organization will continue to recognize Israel and condemn violence even while working together with Hamas.

As Tuesday’s deadline passed, U.S. Secretary of State John Kerry found himself embroiled in a controversy surrounding his use of the term “apartheid” to warn of the consequences for both sides should they fail to make concessions that would lead to a two-state solution.

On Monday evening, the State Department retracted comments Kerry made at a closed-door meeting a day earlier, which were leaked by the Daily Beast.

"If I could rewind the tape, I would have chosen a different word to describe my firm belief that the only way in the long term to have a Jewish state and two nations and two peoples living side by side in peace and security is through a two-state solution,” Kerry said in a later statement.

"While Justice Minister Livni, former Prime Ministers Barak and Ohlmert have all invoked the specter of apartheid to underscore the dangers of a unitary state for the future, it is a word best left out of the debate here at home."

Michael Pizzi contributed reporting, with wire services.