"There are reports the exterior scaffolding nd sheeting is alight, at the moment the response is a third alarm, in addition we also have five crews on the way.
"All people have been evacuated as per the on site supervisor.
"Crews are working and attacking the fire from the outside of the building but there is a lot of smoke in the area.
"Firefighters have established an exclusion zone around the area and it is still an active fire at the moment."
An ambulance spokesman said: "At this stage 13 people have been assessed and treated for smoke inhalation. But we have not transported anyone to hospital."
Rossini waitress Jenny-Emilia Seidel, 18, said she heard "three explosions" as the building overlooking her restaurant went up in flames.
"The building was completely on fire and they were trying to put it out when I heard three explosions," she said.
"This was just after 9am and it was very loud.
"At the moment we are shut because the police told us to close so we don't know what's going on."
Ammette Yazbek was working in the Big Bus company in Circular Quay Station when she noticed people running from the area.
Nearby workers heard a series of explosions.
"I saw everyone walking away and then I saw everyone taking photos."
"A couple of times we've heard what sounds like an explosion, but I am not sure if it is part of the building ... but there is a strong smell of gas
"It is affecting George Street and they have made them move.
"You can still smell the gas but it was really strong before.
