Pinay in Australia fears for safety amid terror attack

Islamic State claimed responsibility for a hostage-taking in the Australian city of Melbourne that left a gunman and another person dead and three police officers injured.

He had called a female escort and arranged to meet with her at the said location.

Claiming responsibility for the attack via its Amaq news agency, the militant group said the attack was in retaliation for Australia's involvement in the US-led coalition fighting the militants in Iraq and Syria.

Prime Minister Malcolm Turnbull said he would speak with state leaders Friday about changing state laws, so that risky criminals like Khayre were not released from prison on early parole.

"We're treating this as a terrorism incident", Victoria Police chief commissioner Graham Ashton said, but added that investigations were still ongoing into whether it was planned or random.

Police move evidence as they search the home of Yacqub Khayre at Roxburgh Park, Melbourne, Australia, 06 June 2017.

Police are yet to confirm Mr Hao's identity, but Deputy Commissioner Shane Patton said the man was recently married and a father.

Authorities said the 29-year-old gunman had a long criminal history and was on parole at the time of the attack. The group has claimed responsibility for a wave of deadly incidents in the United Kingdom, including the weekend attack in London that left seven people dead and nearly 50 injured.

In the building's foyer they discovered a man's body, who they believe was shot.

Three police officers were hurt in a stand-off lasting more than an hour at an apartment building in the beachside suburb of Brighton, police said in a statement. Three officers were injured in the gunfire, and Khayre was eventually killed.

Islamic State have claimed responsibility for the Melbourne hostage attack, saying the gunman was a "soldier" of the militant group.

Khayre, a Somali refugee, served prison sentences for arson and violent crimes unrelated to extremism before being paroled in November, Mr Ashton said.

"The 'Age" website reported that the gunman reportedly called the Channel Seven newsroom during the standoff, telling them "This is for IS (Islamic State)".

Long-time criminal Yacqub Khayre is the man behind the deadly Brighton siege that claimed the life of an innocent apartment clerk.

Large numbers of police soon arrived on the scene at about 4 p.m. local time, Ashton said, including counter-terrorism teams.

He was previously charged, and acquitted, over a suicide plot to attack Sydney's Holsworthy army barracks in 2009.

The Australian leader said the attack in the suburb of Brighton had "shocked all Australians".