A suicide car bomb exploded outside a popular hotel close to the presidential palace in Somalia's capital Mogadishu on Tuesday, in an attack claimed by Shabaab jihadists.

"There was a blast close to the SYL hotel area, near the main checkpoint of the presidential palace," said security officer Ibrahim Mohamed.

A witness described seeing a huge blast. "I saw a car speeding towards the area and huge smoke and fire went up in the sky," said Elmi Ahmed.

An AFP journalist at the scene saw two bodies in the street and described widespread damage to buildings in the area, but reported no gunfire immediately after the explosion.

The Al-Qaeda aligned Shabaab jihadists claimed responsibility for the attack saying it targeted SYL hotel because it "is close to the presidential palace, and also home to apostates and unbelievers."

The hotel was previously attacked in both February this year and January last year.