Excellent quote. Well, first of all, no said there can't be Jews there. Secondly, the problem is apparent when you examine the means by which the Jews attained this land--Zionism (an ideology strongly opposed by most Jews who practice their religion). If you read carefully you'll see that it mentions the "end of days". According to Islam and Judaism, the Jews can only occupy the promise land (Israel) when the Messiah comes (Judgement Day).

THE QUR'AN SAYS THAT ALLAH GAVE THE LAND OF ISRAEL TO THE JEWS AND WILL RESTORE THEM TO IT AT THE END OF DAYS! THE QUR'AN SAYS: "To Moses We [Allah] gave nine clear signs. Ask the Israelites how he [Moses] first appeared amongst them. Pharoah said to him: 'Moses, I can see that you are bewitched.' 'You know full well,' he [Moses] replied, 'that none but the Lord of the heavens and the earth has revealed these visible signs. Pharoah, you are doomed.'" "Pharoah sought to scare them [the Israelites] out of the land [of Israel]: but We [Allah] drowned him [Pharoah] together with all who were with him. Then We [Allah] said to the Israelites: 'Dwell in this land [the Land of Israel]. When the promise of the hereafter [End of Days] comes to be fulfilled, We [Allah] shall assemble you [the Israelites] all together [in the Land of Israel]." "We [Allah] have revealed the Qur'an with the truth, and with the truth it has come down. We have sent you [Muhammed] forth only to proclaim good news and to give warning." [Qur'an, "Night Journey," chapter 17:100-104]