There is no surrendering here. You’re talking about a region where these “two” peoples have been fighting for three thousand years. If they were capable of sharing or conceding, they might have found a way to manage in the last couple millennia.
Israel feel like it’s their rightful land, which can be up for debate depending on who you are, but Muslims in the area also feel that it is their rightful land. Israel refuses to share the land, but then can you blame them when the Muslims (particularly Hamas) have a goal of eradicating them. I’m black and that’s much like asking me to “just get along” with the Nazis next door who constantly advocate for the US to be a white ethnostate. On the flip side of that, is it fair for me to completely segregate anyone who doesn’t look like me or worship like me just because there’s an amount of “them” who might be Nazis?
There’s a way that they could both live in the land, but it’s going to take a major change in leadership (seriously, why is Netanyahu still there?) and a change in the minds for “both” sides that accepts that either they share or they’ll both be destroyed in the end.