Police cars with flashing lights sealed off all four entrances and exits to the supermarket car park, and also sealed off a nearby block of Great King St, after police were alerted about 9.35am.
Senior Sgt Mark Gill said that after Mr Hodge went into the police station and advised that mortar bomb - apparently an inactive training round - was in his car, parked nearby in the car park, police staged the precautionary evacuation, to ensure public safety.
People were allowed to drive away cars already parked in the car park, but no shoppers were allowed to drive in, and pedestrians could not walk through the central car park area.
Mr Hodge had become aware of the existence of the mortar round - apparently a sand-filled training round - which may have dated from World War 2, and may have come from Auckland, through helping support a Dunedin friend, who was recovering after a brain injury.
The training round apparently belonged to a relative of the friend.
Snr Sgt Gill said the cordon had been handled smoothly and police had acted to protect the public from any potential harm.
Otago Regional Council public transport team leader Julian Phillips said the city's bus hub had been out of operation for some time until 10am, but police had promptly notified the bus companies and the council, the matter had taken place for a short off-peak period, and the buses had taken alternative routes.