Justice David Cannings and a court-appointed party visited the facility on Tuesday morning as part of an inquiry into whether asylum seekers' basic human rights are being met.
Justice Cannings said once inside he found the atmosphere to be tense, and that several asylum seekers were in agitated states and had to be calmed.
He told the court in Lorengau, the Manus capital, that the very presence of a judge and perhaps the knowledge or partial knowledge of the transferees that the judge was coming to observe added to the tension.
Justice Cannings - who did not directly address the transferees - also observed that asylum seekers were mostly sleeping in large, 40-man dormitories.
He added that authorities have done the best they can, but the facility seems to have been cobbled together at short notice.
Since the fatal riot on February 17 in which 23-year-old Reza Berati died, asylum seekers have been prevented from leaving the compound for recreational activities.
The inquiry will hear on Wednesday the testimonies of four asylum seekers who will speak through translators