Jordan Patten was at Newcastle MP Tim Crakanthorp's office about 12.30pm on Wednesday before authorities received a welfare report about his behaviour.
Police went to the office and found the weaponry.
Investigators confirmed the 19-year-old circulated a 200-page manifesto to a number of media outlets and public figures.
A seven-minute video filmed before the incident showed Patten wearing a ballistics vest, face mask, gloves and a helmet fitted with a GoPro camera in a public bathroom.
The footage later shows the teen armed with knives and tactical equipment before allegedly walking into the NSW state MP's office and then walking out into the street again.
Mr Crakanthorp, who did not indicate if he was in the office at the time of the incident, said no one had been hurt.
"I have been advised that the individual briefly walked in and out of my office, he left before making any contact with my staff," he said.
"I have spoken with police and they are managing the situation and have assured me that nobody was harmed."
Patten faced Newcastle Local Court on Thursday after being refused bail, charged with committing an act done in preparation for, or planning, a terrorist attack.
The matter will return to the same court on August 21.
Patten's online activities revealed the teen had previously described wanting to carry out terrorist attacks in Newcastle and Sydney, inspired by Christchurch shooter Brenton Tarrant, anti-fascist research group the White Rose Society said.
"The miracle yesterday is that he chickened out and no one was hurt," the group said in a statement on Thursday.
A manifesto published online showed the teen held a range of extremist views.
There was no ongoing threat to the public and a Joint Counter Terrorism Team was continuing to investigate the incident, police said.
It came on the same day Premier Chris Minns joined Mr Crakanthorp in Newcastle for media events, including the inspection of a soon-to-open walking and cycling track.
They were joined by Counter-Terrorism Minister Yasmin Catley.
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