Taiwan's official Central News Agency reports the ground floor of the Marshal Hotel, a building in Hualien district, had caved in and people were believed to be trapped inside. The agency posted photos showing a road fractured in several parts.
Taiwanese media reported that aside from the cave in on the ground floor of the Marshal Hotel, a separate hotel known as the Beautiful Life Hotel, is tilting.
"We know there are people who are trapped inside -- we can see lights inside the hotel," witness Zeena Starbuck told BBC News. "People with phones are shining their lights to let people know they're there."
Tuesday night's quake followed one over the weekend off the coast of Hualien on the east of Taiwan, which lies along the famed "Pacific Rim of Fire" known for seismic activity from Alaska to Southeast Asia.
The quake came exactly two years after a magnitude-6.4 quake struck southern Taiwan, causing the collapse of an apartment complex and the deaths of 115 people.
Five people involved in the construction of the complex were later found guilty of negligence and given prison sentences.
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