Dover Heights arrest: Two men in balaclavas caught near John Ibrahim's home

Two men wearing balaclavas have been arrested near the home of John Ibrahim in Sydney's eastern suburbs - with one found carrying a gun.

The pair were caught acting suspiciously before police were called to the scene on George Street at Dover Heights shortly before 9am on Thursday.

One of the men fled on foot before he was arrested while the second led police on a car chase until he was stopped and handcuffed.

'A police operation has concluded in the Eastern Suburbs following a pursuit this morning,' a NSW Police spokesman said.

'Officers attached to Eastern Suburbs Police Area Command have arrested two men. Inquiries are ongoing.

Detectives were seen speaking to Ibrahim at his house shortly after the arrests. 

Police had blocked off roads to Dover Heights as a PolAir helicopter circled the sky above the affluent coastal suburb as they pursued the two men. 

A black Range Rover was later observed leaving the area under police escort about 10am.