The initial explosion, at about 11:10 pm local time (21:10 GMT), was heard as far away as central Tel Aviv.
It was not immediately clear if anyone remained trapped in the collapsed building, which reportedly used to house a construction supplies store.
Local media reported that screams could be heard under the debris of the building. The blast was so powerful that debris was scattered to nearby streets, with fire engulfing cars parked in the vicinity.
The cause of the blast and subsequent fire is still being determined. A preliminary investigation indicated that the source of the explosion might have been in a hardware store next to the building, Arutz Sheva reported, citing police.
I24news reported that the fire was likely sparked by flammable materials kept in the paint shop located in the building.