Residents flee as fear grips a Sydney street during Surry Hills siege A man is led away by police after the siege / Pic: Cameron Richardson Source: The Daily Telegraph Police arrest a man in Surry Hills, Sydney, after a dramatic siege. Police prepare to enter the unit complex / Pic: Cameron Richardson Source: The Daily Telegraph A DRAMATIC siege in Surry Hills yesterday led to a mass evacuation of terrified residents as a man reportedly armed with a gun barricaded himself in an apartment. Fearing he might open fire, heavily armed police closed off streets and ordered people - including women and children - from their homes after a disturbance at a housing commission block on Devonshire St. After a tense two-hour standoff, a 36-year-old shirtless man - allegedly known to police - was arrested after a team of tactical operatives with military-style automatic rifles surrounded the apartment building. Police had been called to the area at 4.20pm following reports the alleged offender had threatened another man with a firearm. A woman and her two young children were evacuated from a nearby unit while others residents escaped by running across the road into a safe zone set up by police at the perimeter. Drinkers in a hotel across the street from the siege were ordered to stay away from the windows, as the operation continued. "A family of four was taken from the near vicinity and relocated to a nearby hotel," Surry Hills commander Superintendent Tony Crandell said, adding no weapon was recovered immediately after the arrest. A search warrant application is being made to search the premise to confirm or indicate if a firearm has been hidden in the premises. One resident who rushed out of the building told The Daily Telegraph he stepped out of his unit, saw an armed officer standing inside and was told "run." I ran to the gate and there were more police there and they told me to duck and run. I ran the wrong way first and then they pointed me in the right direction," the man said. I was in my house not aware there was an apparent gunman in the building. The block of flats is at the corner of Devonshire St and Clisdell St and is a notorious hotspot, with police regularly called to the area. Earlier in the afternoon police were seen talking to a male and female, believed to have been associated with the arrested man, while the tactical operations unit arrived. With guns pointed at the windows, tactical police escorted a negotiator - wearing a ballistic helmet - into the housing block about 6pm. Shortly afterwards he emerged, signalling the end of the drama. The man was last night expected to be charged with a range of offences. He will appear before a Sydney court today.