The council had been in contact with those at the shelter to let them know what was happening.
Kiri Swannell, of Limitless Hope, said the council locking the gates the week before Christmas was "pretty stink. I agree the guys need to get out of there but I believe in being proactive.
"This could have been done sooner - now they will have nowhere to go for Christmas."
Mrs Swannell said 80 per cent of the homeless were on the Housing New Zealand waiting list and had been for months.
"They want to be off the street but have no choice."
She said trauma or tragedy - whether it be spiritual, physical, mental or emotional - was part of the reason they were on the streets.
"This is a problem throughout New Zealand and the Government continues to put barriers up to keep the poor poorer.
"We have to stop putting sticking plasters over stuff."
Limitless Hope will host an outdoor restaurant in the middle of Clive Square today, from 4pm. There will be live bands, councillors, members of Parliament and Santa.