The popular Loukoumades shop near Henley Square, South Australia, has been totally destroyed after going up in flames just after 2am this morning, in what police believe is an arson attack which they are now investigating.

The fire gutted the interior, also damaging an adjoining ice-cream store.

More than 40 firefighters battled and managed to contain the blaze in about 15 minutes using high pressure lines and breathing apparatus, stopping it from spreading to other nearby shops.

The incident caused about $300,000 damage.

“We are just shocked that something like this would happen in our usually quiet neighbourhood, especially during the summer months when everyone is around the square dining and swimming until late,” Vicki, one of the locals who has lived in the area for over ten years, told Neos Kosmos.

“I cannot believe that this happened. This is a very popular area where many families, and a lot of Greek Australians gather every day to enjoy a day at the beach and a meal. I take my son down there for loukoumades and ice cream all the time. I hope the police catch whoever did it.”

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Loukoumades restaurant following the fire. Photo: Social media

Milad Nahravani, the person that discovered the shop on fire, said that the noise got his attention. “It was breaking the glass… it was full blasts going through, blowing up some of the fuse boxes. It was pretty horrific,” Mr Nahravani said. “It’s putting people’s lives in danger and there are families and kids living around here as well.”

Award-winning Greek restaurant Estia is also located a few metres down the road from the Loukoumades building.

The building’s owner John, who declined to give his last name, described the incident as a “tragedy” for the owners of both the loukoumades and ice-cream shops.

“It’s a terrible shame,” he said.

John said his main focus was to get the ice-cream shop up and running as soon as possible.

There are three Loukoumades stores in South Australia, located on King William Rd at Hyde Park, Magill Rd at Kensington Park and Seaview Rd at Henley Beach.

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The King William Rd store was the first of the franchise to open, in December 2017 The Henley Beach shop was the second and opened in October 2018.