Remove the ?> and <?php. They don't belong there since your goal isn't to stop the PHP interpreter and break out into text mode.
A few easy ways to write it:
PHP Code:
$var = "HTML code here
can be as long
or as short as you like
blah blah blah more html";
PHP Code:
$var = "HTML code here\ncan be as long\nor as short as you like\nblah blah blah more html";
//Note: The newline characters (\n) will only be correctly
// interpreted if this string is enclosed in double quotes,
// not single quotes
PHP Code:
$var = <<<EOD
HTML code here
can be as long
or as short as you like
blah blah blah more html
EOD;
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