1) No.
NO.
Do NOT store combustibles close to a water heater, fireplace, or any source of ignition, including HVAC, space heater, microwave, appliance, etc.
http://waterheatertimer.org/Troubleshoot-Rheem-Tankless-water-heater.html#bang2) Tankless water heaters do not have FVIR safety features found in tank-type gas water heaters rated less than 60,000 BTU.
3) Tankless water heaters draw large amounts of air into combustion chamber from surrounding room, and this air feeds directly into the burner flame with no barrier.
4) If flammable vapors enter tankless, then it can cause fire, explosion, conflagration.
5) Read product manual and safe a life.
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