UPDATED 05/11/11 5:45 p.m.

CHICAGO (CBS) — One robber remains on the loose, and another was shot and killed by police, after officers caught them holding up a convenience store in the Bridgeport neighborhood.

Around 1:30 a.m. Wednesday, two armed men wearing hoodies stormed into a J.J. Peppers convenience, adjacent to a Marathon gas station at 659 W. 31st St., and robbed it. CBS 2’s Roseanne Tellez reports from the scene of the robbery.

The store just so happens to be about a block away from the Deering District police station, at 3120 S. Halsted St. Officers often stop there for coffee, police said.

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But it was actually officers from the Prairie District, which begins a couple of blocks to the east, who were “in the right place at the right time” and drove by as the robbery was in progress, a district captain said.

The officers “saw two individuals going in, wearing hoodies, and thought, ‘This isn’t right,'” Chicago Fraternal Order of Police spokesman Pat Camden said.

Police say as the officers approached them near the front door, one man pulled out a gun and started shooting.

“I heard about 15 shots of gunfire,” said neighbor Kelly Haepp.

Neighbor Ramona Rivera said she was “pretty scared, because they sounded pretty close to home, and we saw the light reflection from the shots.”

One of the officers returned fire, killing one of the men. In daylight, markers for 21 shell casings were visible outside the convenience store.

The police SWAT unit was brought in early on to determine whether the second suspect was still in the store, and perhaps had barricaded himself inside.

“I heard an officer on a megaphone, and I’m like, ‘Whoa, this is highly irregular,’ so I was drawn outside, and I see this long police barricade,” said neighbor Tom Vasilij.

Neighbors initially heard the incident had sparked a hostage situation, but the clerk was able to jump out of the store unharmed.

“I have a 14-year-old daughter; kind of scary,” Haepp said. When asked if she goes to the store where the incident happened, she said, “I go to J.J. Peppers a lot, yes. I know the clerks, actually, so I was a little concerned about the people that work there.”

But the second robber was not in the store. It turned out the other suspect ran out the back door, and a manhunt remained underway.

In a nearby alley, police later found a jacket the escaped suspect was wearing.

Police closed 31st Street between Halsted and Wallace streets after the incident. Nearly six hours later, 31st Street reopened.

Camden, formerly the police News Affairs Deputy Director, said the officers are heroes.

“They saved the clerk, and not only prevented and armed robbery; it may have prevented something even worse,” Camden said, “and again, that’s what young policemen do. That’s what old policemen do. Their job is to serve and protect, and they do a fine job of it.”

The two officers were transported to an area hospital for observation only. Police recovered a weapon at the scene.

The J.J. Peppers store owner says the clerk is fine. Police have not released the identity of the slain suspect, but did say they have surveillance tape from the store.

The Sun-Times Media Wire contributed to this report.