(JTA) — U.S. Secretary of State John Kerry’s statement to a roomful of world leaders that Israel could become “an apartheid state” if peace talks fail is “deeply troubling,” the American Israel Public Affairs Committee said.

Kerry made the remarks Friday during a meeting of the Trilateral Commission, which includes senior officials from the United States, Europe, Russia and Japan, the Daily Beast reported on Sunday evening, saying it had obtained a recording of the closed-door meeting.

“A two-state solution will be clearly underscored as the only real alternative,” Kerry said, according to the Daily Beast, “because a unitary state winds up either being an apartheid state with second-class citizens or it ends up being a state that destroys the capacity of Israel to be a Jewish state.”

In a rare statement targeting a sitting member of a Cabinet, AIPAC said that “any suggestion that Israel is, or is at risk of becoming, an apartheid state is offensive and inappropriate.”

Other major Jewish groups, including the American Jewish Committee and the Anti-Defamation League, said the comments were “inappropriate.”

In her daily briefing with reporters, Jen Psaki, Kerry’s spokeswoman, would not confirm that Kerry made the comments but noted that past Israeli prime ministers, including Ehud Barak and Ehud Olmert, had delivered similar warnings.

She said that “no one could accurately question (Kerry’s) friendship to Israel and his belief it is a democracy.”

Kerry reportedly blamed both Israeli and Palestinian leaders for the current halt of the U.S.-backed peace talks.

According to the Daily Beast, he reiterated a warning that the failure of the Israeli-Palestinian negotiations could lead to a resumption of Palestinian violence against Israeli citizens. Kerry said he believes a change in the leadership of either the Israelis or Palestinians could help bring about a peace deal, and he heavily criticized Israel for continuing to build in West Bank settlements.

“There is a fundamental confrontation and it is over settlements — 14,000 new settlement units announced since we began negotiations. It’s very difficult for any leader to deal under that cloud,” Kerry said.

He told the world leaders that he is considering releasing his own peace plan and telling both sides to “take it or leave it,” according to the Daily Beast.

Kerry said both sides will have to make the tough decisions necessary for achieving peace.

“There’s a period here where there needs to be some regrouping. I don’t think it’s unhealthy for both of them to have to stare over the abyss and understand where the real tensions are and what the real critical decisions are that have to be made,” he said. “Neither party is quite ready to make it at this point in time. That doesn’t mean they don’t have to make these decisions.”

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