The collapse happened around 1:20 p.m. the site of the old Shirt Corner store at the intersection of 3rd and Market.
Demolition had been going on for more than a week and, on Thursday, workers were taking apart the roof when the building gave way.
No one was hurt when the building came down.
Witnesses say the demolition crew had been preventing traffic from going down 3rd Street, but they say pedestrians had been walking in the street right next to the fence that was crushed by the collapse.
At a news conference on Thursday, L&I Commissioner Carlton Williams said the project was a permitted demolition. The property was inspected on January 24th, Williams said, and it was declared dangerous.
That's when the owners were told to demolish the property.
Williams said L&I had inspectors on site every day during the demolition.
"On Saturday we actually got a call from the fire department who was concerned about the appearance. We went out and we actually moved the pedestrian walkway," said Williams. "We've been this project from the time it started and we've been staying on it ever since."
"We took every safety precaution in accordance with the mayor's executive order and the new demolition legislation to ensure pedestrian safety," said Williams.
Rob Molinaro was having lunch across the street when he decided to take a video of the work in progress.
He caught the dramatic moment when the upper wall collapsed outward, setting off a chain reaction.
The wall crushed what remained of the structure on the corner and that, in turn, fell out onto 3rd Street.
"We thought it was going to go this way, into the open lot, but then all of a sudden it took a left-hand swing and it was gone," Molinaro said.
The street had been blocked off by the demolition crew, but people in a nearby pizza shop say it came too close for comfort.
"We got scared, we thought the thing was going to crush us," said Mehdi Labidi. "Thank God it was just dust. It blinded us instantly, it blinded us for a couple of minutes. We couldn't see nothing."
The developer originally planned to preserve the collection of old buildings and restore them, but an inspection showed they were too far gone to save.
The site was being cleared to make way for a residential and retail development.
A spokesman for the developer says it was all being done by the book.
"It's been done with public safety being maximized, with the fire department and L&I fully aware of what was going on," said David Neff of Neff Associates.
Witnesses say the demolition crew had been preventing traffic from going down 3rd Street, but they say pedestrians had been walking in the street right next to the fence that was crushed by the collapse.
The construction superintendent says they did everything they could to make sure the job was progressing safely.
"Obviously you don't want it to go into the street but, assuming that being this close to the street and this tall, we had to be careful so we closed everybody off and kept them out of the way," said Mark Christof of Constructure Management Inc.
This collapse comes less than a year after another building under demolition collapsed along Market Street in Philadelphia.
Back in June, a building under demolition collapsed onto a Salvation Army store at 22nd and Market in Center City, killing six people.
Sean Benschop and Griffin Campbell are facing a number of murder and manslaughter charges.
