A police standoff with a distraught gunman at Vancouver's Fairmont Pacific Rim hotel that shut down parts of the city's downtown core Monday has ended without any serious injuries.

Police say around 12:15 p.m. PT, they set off a flashbang device inside the hotel to distract the man, and then an officer stepped in and fired a plastic round from a special Arwen gun striking the man in the leg.

Officers then took the man's handgun and arrested him. He was taken to hospital with a very minor injury.

The man's identity has not been released but police believe he is a 28-year-old from Surrey, B.C., with a history of mental illness, but no previous connection with the hotel. Police say the handgun was real.

The incident will not be investigated by the Independent Investigations Office because the man's injuries were not serious.

Walked into lobby with gun

The incident began early Monday morning when the distraught man walked into the lobby of the Fairmont Pacific Rim Hotel around 2:30 a.m. PT and showed his gun to staff.

After staff at the hotel set off the fire alarm, the man ended up confined alone in a public area on the second floor for much of the morning.

Officers spent hours negotiating with the man, but police initially said he only asked for water and made no demands.

No guests or staff were injured in the incident and the man did not fire his handgun.

Parts of downtown Vancouver were blocked off on Monday morning after a distraught man with a handgun walked into the Fairmont Pacific Rim Hotel. (Steve Lus/CBC)

Police initially told guests to stay in their rooms, but began allowing them to leave after several reportedly sneaked out of the hotel through a back staircase.

The hotel is located in the city's downtown business district near Burrard Street and Canada Place. Traffic around the hotel was blocked off for several blocks for most of the morning.

The incident forced many in the area to change their plans, including Premier Christy Clark, who had to postpone a news conference scheduled nearby at the Canada Place building.