A meeting about the violence in the country is said to have taken place at the hotel when extremists from the jihadist group al-Shabaab launched an attack.
The armed men are said to have rammed the hotel in the city of Beledweyne with a vehicle full of explosives. Then, several extremists entered the building and started shooting people, according to a security official.
The meeting between traditional and military leaders concerned support for the Somali government's fight against al-Shabaab.
The Islamic extremist group has been fighting against the government in Mogadishu for over 15 years and carried out several deadly terrorist attacks. Somalia's president has promised a "total war" against al-Shabaab.