WATCH: Armed Gunman with Islamic Flag Holds People Hostage Inside Cafe in Sydney, Australia; 5 People Escape

A hostage crisis at a central Sydney cafe dragged deep into the Australian night with a lone gunman issuing demands and claiming to have bombs scattered around the city, multiple media outlets were reporting Monday.

The gunman released videos stating that he wants an Islamic State flag and a phone call from Austrian prime minister Tony Abbott. He also has made bomb threats, media outlets including Sky News Australia were reporting.

More than 12 hours after the siege began, Monday night turned into Tuesday morning in Sydney. Hundreds of heavily armed police officers, many in sniper positions, had taken control of the streets around the Lindt Chocolate Cafe in Martin Place, the heart of the city’s financial and shopping district.

Five hostages were able to flee to safety; an undisclosed number of hostages remained in the cafe, police said.

“We are doing all we can to set you free,” New South Wales state police Commissioner Andrew Scipione said at a press conference.

The incident began at around 9:45 a.m local time — Sydney is 16 hours ahead of New York. Scipione saidthat if people were being contacted by hostages, “we would ask them to ensure the man inside speaks to police.”

He said he was not in a position to go into details about “who is in there, and how many are in there.”

Three people ran out of the cafe six hours into the hostage crisis. About an hour later, two women wearing aprons with the Lindt chocolate logo fled the cafe into the arms of heavily armed police officers.

Television video shot through the cafe’s windows showed several people with their arms in the air and hands pressed against the glass, and two people holding up a black flag with the Shahada, or Islamic declaration of faith, written on it.

Kathryn Chee, who works at the cafe, told ABC News she had planned to arrive at work early when her mother told her the news of the incident.

She said she saw pictures on TV of hostages with their hands against the windows.

“Straight away, there were three people that I knew….my heart just sank,” she said. ‘It’s just a little cafe, we have regular customers, people we know their orders…we’re already making their order before they get to the counter.”

Australian Prime Minister Tony Abbott urged Australians to go about their business as usual in a speech from Canberra on Monday.

“Our thoughts and prayers must above all go out to the individuals who are caught up in this,” he said.

He earlier said the events may be “politically motivated.”

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SOURCE: William M. Welch, Jane Onyanga-Omara and John Bacon
USA TODAY

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