If you do not have to worry about the different kinds of line breaks ("\n", "\r\n", "\r") you can simply use a multi-line string literal like e.g.
$xml = '<myxml>
<items>
<item1>blah</item1>
</items>
</myxml>';
or
$xml = <<< EOT
<myxml>
<items>
<item1>blah</item1>
</items>
</myxml>
EOT;
But keep in mind that those documents aren't necessarily equivalent to
<myxml><items><item1>blah</item1></items></myxml>
http://www.w3.org/TR/REC-xml/ says:
2.10 White Space Handling
[...]
An XML processor MUST always pass all characters in a document that are not markup through to the application. A validating XML processor MUST also inform the application which of these characters constitute white space appearing in element content.
A special attribute named xml:space may be attached to an element to signal an intention that in that element, white space should be preserved by applications
Whitespaces can be marked as significant or insignificant and the consumer can more or less choose if it handles them as in-/significant, e.g. via <xsl:strip-space .../>
.