Police and City of Sydney workers moved into the camp towards the Macquarie St end of Martin Place on Saturday morning.
The City of Sydney says LendLease Building was approved to construct hoardings on Investa's 60 Martin Place development in May.
Police and City of Sydney workers moved into the camp on Saturday morning, leaving beds, cots and clothes on the Macquarie Street end of the thoroughfare.
A note, written in chalk in the near-empty camp said: "They tried to bury us. They didn't know we were seeds."
Men and women wearing high visibility clothing swept rubbish into bags.
Family and Community Services staff set up tents, where they offered assistance to those needing to find accommodation.
State Premier Gladys Berejiklian said preparations have long been in place since it was realised that the homeless population would be affected by the inner city construction.
"We knew this day would come," she said.
"We've made sure Family and Community Services has been there to support those people."
The area is still flanked by banners promoting Thursday's CEO Sleepout, an annual fundraiser drawing attention to the issues.
But for the homeless, the very real issue of where they would be sleeping that night was uppermost in their minds.
'People have walked away traumatised'
Lanz Priestley, co-founder of 24-7 Street Kitchen and Safe Space, said the number of homeless people in Australia is at staggering levels.
"What about the other 1400 that are homeless in Sydney right now? Never mind those that are homeless in all the other states. Yeah unless we solve this nationally we're not gonna solve it at all," he told SBS World News.
The reassurances of help and support from the local council and state governments did not ring true for some of the homeless in Martin Place.
"The jury's still out. We've still got a few people who've walked away traumatised from this, who haven't been housed yet," Mr Priestley said.
Wrapped in a sleeping bag and surrounded by piles of possessions, Troy Drysdale talks about finding "family" at a Sydney CBD homeless camp.
He's asked where he will go now that the community has been moved for a development.
"Who knows," the 18-year-old told AAP.
"See what happens."
"I just woke up (and) I was just getting kicked out of my tent," Mr Drysdale, who said he has previously had a bad experience with government housing, told AAP.
"We're all family. I mean, we were all just trying to survive."
Fire and safety risk
Family and Community Services says it has been working with Martin Place residents, finding temporary accommodation for 115 people and permanent housing for 24 more.
A spokesperson for the City of Sydney said council the state and local government is ensuring access to accommodation, health services and specialist services for homeless people in the area.
"Alternative accommodation has been offered to all people in the area. Some people have accepted the offer, while others have declined assistance," the spokesperson said.
The spokesperson said cooking facilities and the obstruction of the public thoroughfare presented a fire and safety risk.
"Public health and safety is our primary concern in responding to this situation. We are working hard to ensure that the public space can be accessed safely by everyone, including people experiencing homelessness."
- with AAP
