A man is in custody after an alleged armed carjacking in Melbourne’s south east this morning.

Investigators have been told three men met two other men at a car park at a licensed premises on the South Gippsland highway just before 7am.

A verbal altercation ensued and one of the trio allegedly produced a firearm before another of the men fled in the victim’s Ford ute.

The vehicle was found in the Westfield Fountain Gate car park about two hours later.

Vicky told Neil Mitchell police swarmed the area, as a man was taken into custody.

“I went down Pound Road, Hampton park about 9.30, and the police had someone pulled over in the church carpark,” Vicky said.

“They’ve got the road blocked off either side of the church, between Lakeside Drive and Amberley Crescent.”

Two off duty police officers arrested the suspect inside Fountain Gate shopping centre.

They believe the carjacking was a result of an verbal altercation between five men, all of whom are known to each other.