Heavily armed officers and armoured vehicles were at the park in Bunbury in southwestern Western Australia for more than 12 hours.
The man had a large banner with "Police release Batty Archibald CCC report" written on it.
Early on Friday morning, the negotiator was heard urging the hostage taker to release the man he's been holding, reporters at the scene said.
The negotiator urged the offender to consider how his hostage was feeling and to end the situation peacefully.
She also told the man that the media was present, and that they'd seen his banner.
A robot with a "communications device" was also sent in.
The park, near the corner of Koombana Drive and Blair Street, is cordoned off and members of the public have been urged to stay away.
Police know who the hostage taker is, but have not confirmed media reports that the man may be armed with explosives or a gas cylinder.
"We have concerns for one person in the vicinity of this man, who we are trying to negotiate with," WA Police spokesman Sam Dinnison said earlier.
"Members of the Tactical Response Group are on the site and they are dealing with the situation."
Police are expected to update the media on soon.
- AAP
