Taupo CIB acting area manager of investigations Detective Sergeant Andy Livingstone said a scene examination was being carried out and police were working to establish exactly what had occurred.
"We are also working to provide ongoing support to the victim's whānau and witnesses to this morning's events.
"Police would like to hear from anyone who may have information that could help the investigation team."
Specifically, police would like to speak with anyone who saw a vehicle arrive at and leave the motel around the time of the incident, he said.
The motel's manager, who didn't want to be named, said the man was an emergency housing client and had been at the motel with his partner and children since the start of December.
He said he woke to hear a noise around 6.30am and called emergency services.
He described what happened as "bad" but didn't want to go into details.
He said the motel was fully booked with emergency housing clients and everyone was shocked and sad.
"It's so sad ... It was bad."
A nearby business manager, who didn't want to be named, said there were often incidents at the motel involving police and he wasn't surprised something terrible had happened.
He said, in his opinion, businesses in the area were constantly frustrated with what went on at the motel and felt those coming and going from the motel were bringing the area down.
"It's really just the state of affairs that it has come to this."
A resident in the area said police were guarding the motel with black material. He said barricades have been erected and it wasn't possible to enter or see into the motel.
Anyone who can help has police been urged to call 105 and refer to "Operation Dell".
You can also share information anonymously through Crimestoppers on 0800 555 111.
The Ministry of Social Development has been approached for comment.
