“A police operation was commenced when it was established that the man was possibly inside a unit at the complex,” the spokesperson said.

“Officers entered the premises about 10pm on Friday, but were unable to locate the man inside the premises.

“Inquiries are continuing.”

8pm: Police have surrounded a unit complex at Warrawong in an hours-long operation that continues to unfold. 

Residents say police swarmed the area from about 2pm Friday. 

A Polair chopper was overhead earlier this afternoon. 

Meantime, police have set up a command post in the car park of a nearby sports field and the area has been flooded with marked and unmarked police cars. 

Riot Squad police arrived at the Illawong Gardens public housing complex about 7pm. 

Police attention has focused on the complex's so-called 'D Block', the second-closest block to the western boundary with Westfield Warrawong. 

About 5.30pm, police flew a drone-mounted camera past the block, apparently taking a closer look at a first-floor unit. 

Residents have been free to come and go for much of the evening but a short time ago, as Riot Squad police approached 'D Block', residents of some blocks were told not to enter or leave their homes.

Lake Illawarra Chief Inspector Steven Johnson said the incident did not pose a threat to public safety. 

“We've got a number of police resources deployed including specialist resources as part of a police operation being conducted at Illawong Gardens,” he said, declining to reveal the nature of the operation. “We will be here for as long as it takes to resolve the situation.

“We ask the public to avoid the area and we are managing the residents to make sure they’re safe.’’

He said a number of road blocks were in place, at the complex and in nearby streets, to maintain the security of the area.