Reports say a man is in custody after police found him with a replica gun near Martin Place in central Sydney.

Police say they arrested a man about 2pm on Sunday, metres from the intersection of George Street and Martin Place.

They say he was found walking around about 400 metres from the Lindt Chocolate Cafe, the site of the December siege that claimed the lives of two hostages and a gunman.

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The cafe reopened on March 20, 2015, after closing following the deadly 16-hour siege.