The incident first unfolded about 8 a.m. Officers have barricaded some streets downtown.
Police are telling bystanders the suspect was chased into the Pink House and is holding two hostages. Police were turning away employees who were reporting for work.
Numerous witnesses say a crime occured at Broughton and Bull and that shots were fired. At least two ambulances have responded.
Broughton and Drayton have been taped off as a crime scene.