"We had a mortar attack," the contractor said near the al-Sadeer hotel as ambulances and police cars, sirens wailing, rushed to the scene late on Friday.
Witnesses said there were several injuries. A Reuters correspondent said the blast appeared to have occurred near the hotel, although this could not be immediately confirmed.
Abu al-Adeem Muhammad, Aljazeera's correspondent in Baghdad, said the missiles passed over the Aljazeera office, which is situated few kilometres from al-Sadeer hotel.
Four Iraqi deaths were reported, including a six-year-old boy and another child, Muhammad said.
The US military was not available for comments.
Elsewhere in the country, two Iraqis were killed and another wounded by mortar fire on Friday in a second day of heavy fighting in the city of Samarra, a hospital source said.
"We have received two dead bodies and one injured Iraqi," said Abdel Hamid al-Samarrai, director of the general hospital in the town, 125 kilometres (75 miles) north of the Iraqi capital, adding that the incident happened at 20:50 (1650 GMT).
Local residents accused US forces in the area of firing the mortars, but a US military spokesman said he had no information at present about the incident.
There was no way to confirm immediately who fired the mortars.
Five US soldiers and six Iraqis, including two national guards individuals, were killed in the defiant Sunni Muslim stronghold on Thursday during a car bomb and mortar attack on a national guard station, followed by US-led military retaliation.