A staff member at McDonalds in Worthing sprang into action when he saw a fire at a nearby store in the early hours of this morning.
The fire service confirmed that bedding belonging to a rough sleeper was set on fire at 12.20am in the Montague Centre.
The fire spread to the Laura Ashley store, which is closed today due to the damage.
It is believed the fire was started intentionally, the fire service said.
Crew member Dan Brooks was working a shift at McDonalds when he looked outside and saw the Laura Ashley shop on fire.
He said the fire looked 'quite bad' and he went out with a fire extinguisher to put out the flames.
"It looked quite bad," he said. "There was a bit of damage.
"The homeless man lost all of his stuff."
Today, Graham Sawyer, who has been sleeping rough outside the Laura Ashley store for some time, told the Herald he had been busking round the corner when he was alerted to the fire.
His guitar, which he is often seen playing in the town centre, was undamaged, as was some of his bedding, and he said he had been donated some new quilts since the fire.
The area has been cordoned off by police.
Fire crews used four breathing apparatus and one hose reel at the site this morning, before leaving the scene at 2.02am.
Julie Pellegrino, assistant manager at Laura Ashley said staff were alerted at 2am.
She said the fire had left part of the store 'smelly and mucky' and said: "There is quite a bit of water damage and one of our room sets has been burnt."
She said the window was shattered and one of the sofas had caught fire.
"We will not be opening today or tomorrow, we will have to see about Monday," she said.
"We hope to be open in some form on Monday."