The railroad south of West Palm Beach was constructed in phases by the FEC and the predecessor systems. Flagler began his railroad building in 1892. Under Florida's generous land-grant laws passed in 1893, could be claimed from the state for every mile (1.6 km) built. Flagler would eventually claim in excess of two million acres (8,000 km²) for building the FEC, and land development and trading would become one of his most profitable endeavors. Before it became the FEC, the Jacksonville, St. Augustine & Indian River was constructing a line southwards from Daytona Beach in 1894. Fort Pierce was reached on January 29, and West Palm Beach on March 22. Further extension southwards did not begin until June 1895, when a favorable deal was signed with Miami-area business interests. Fort Lauderdale was reached on March 3 of the following year. By April, the construction reached Biscayne Bay, the largest and most accessible harbor on Florida's east coast. Flagler announced in 1904 that the FEC would be extended to Key West over the ocean. However, in 1906, a powerful hurricane killed 135 of Flagler's workers. The Over-the-Sea Extension was completed in 1912, a mere 16 months prior to Flagler's death, at a cost of $50 million and the lives of hundreds of workmen. Flagler next sought perhaps his greatest challenge: the extension of the Florida East Coast Railway to Key West, a city of almost 20,000 inhabitants located beyond the end of the Florida peninsula. He became particularly interested in linking Key West to the mainland after the construction of the Panama Canal was announced by the United States in 1905. As the closest deep-water port in the United States to the canal, Key West was positioned to take advantage of significant new trade with the west that would be enabled by the opening of the canalthis, in addition to the city's existing involvement with Cuban and Latin American trade. The construction of the Overseas Railroad required many engineering innovations as well as vast amounts of labor and monetary resources. At one time during construction, four thousand men were employed. During the seven years of construction, three hurricanes threatened to halt the project. Workers toiled under conditions sufficiently cruel and harsh that the US Justice Department prosecuted the FECR under a federal slave-kidnapping law. Journalists also chronicled conditions of debt peonage wherein immigrant labor was threatened with prohibitive transportation fees to leave Key West after seeing the unsafe and disease-ridden conditions, essentially forcing them to stay.