An Indonesian military transport plane crashed into a hotel and residential area in the northern Sumatra city of Medan on Tuesday, killing at least 30 people, a national search and rescue agency official said.

"That's the latest information, the number could go up," Hisar Turnip of the Basarnas agency told Reuters.

Military spokesman Fuad Basya said that 12 personnel, including the pilot, had been aboard the C-130 Hercules. The bodies of five of them had been found.

Local television showed a neighbourhood of houses and hotels in flames and black smoke billowing from the area.

According to the Aviation Safety Network, there have been 10 fatal crashes involving Indonesian military or police aircraft over the last decade.

The accidents put under a spotlight the safety record of Indonesia's aviation and its ageing commercial and military aircraft. Basya said the plane that crashed on Tuesday was built in 1964.

An AirAsia plane crashed less than halfway into a two-hour flight from Surabaya in Indonesia to Singapore on Dec. 28. All 162 people on board the Airbus A320 were killed.

The Hercules transport plane was on its way from an air force base in Medan to the remote Natuna islands and crashed a few minutes after take-off, Basya said. Media said the pilot had asked to return because of technical problems.

"It passed overhead a few times, really low," said Elfrida Efi, a receptionist at the Golden Eleven Hotel.

"There was fire and black smoke. The third time it came by it crashed into the roof of the hotel and exploded straight away," she told Reuters by telephone.

She said the plane also hit a massage parlour, where there are normally several people during the daytime.

Sairi M. Saragih, a public relations official at the nearby Adam Malik Central General Hospital, said 11 bodies had been brought in so far.