"While firefighters were trying to contain the fire, the roof collapsed.
"We were able to contain the fire to the rear of the building but the residential area was to the front of the building."
Other flats adjoining the premises were evacuated and no one else was hurt, he said.
There was a scene guard on the property and a team of specialist fire investigators will kick off investigations this morning.
St John Ambulance attended the blaze about 1.30am to treat a critical patient but no transport to hospital was required.
Meat Man employee Derek Paul said the smoke was thick throughout the town in the early hours of the morning.
The Belmont St shop sits directly across from the commercial and residential building which was engulfed in flames about 1.20am.
A delivery driver for Meat Man couldn't open his windows as he drove through town, Mr Paul said.
"He had to drive right around instead of straight through the middle and he couldn't even open his window up because smoke was so thick.
"We're straight across the road from it but the front looks the same from here."
Customers had been talking about the incident all morning and couldn't believe someone died in the blaze, he said.
Police had cordoned off the building and were still on site, Mr Paul said.
A business owner whose shop backs on to the gutted section of the building said the team was "devastated" about the death of a neighbour.
Home Maintenance and Joinery Services was saved from the blaze by a firewall and only lost power from the incident, she said.
The owner, who asked not to be named, said the middle part of the building had been gutted but from the front and back it looked the same.
"Apart from losing power we're fine but we're just pretty devastated about the death of a tenant," she said.
"It's just bricks and mortar as far as we're concerned but we've lost a very good neighbour."
The Refinery owner Nicola Petry said the incident was the talk of the town.
Her cafe was next door to the gutted concrete building and surrounded by trees, but luckily escaped any damage, she said.
A siren alerted the local Volunteer Fire Brigade and nearby residents as high flames and windows exploded outwards during the blaze, she said.
"It was quite frightening, it was very close.
"We've had phone calls and things this morning. It's a small town and people could see it and hear the siren. It's very much the talk of the town."
A neighbour of the deceased said he was woken by fire engines and the sound of cracking wood at the back of his flat.
"I looked down through the window and saw big flames flying up. I didn't stay around."
The man said he knew the person who died, who he said was aged in his 60s, and lived in the ground floor of the building.
He was also well known in the small town, he said.
A business owner, who lives a few doors down, said he still hadn't slept since the fire.
"[The person] was quite a good friend. That's the second friend that I have lost in town. I was also friends with [murder victim] Jordan [Voudouris]."
No identifying details about the person who died have been released.
