It was the backdrop to a literary world of the lost Levant. Away from the sea, on a narrow street in the old Greek quarter of Alexandria, 10 Rue Lepsius was the home and creative sanctuary of Constantine Cavafy.

For 26 years, it was here that the poet, a bureaucrat in British-run colonial Egypt, held court, treating writers such as EM Forster to long candle-lit nights of talk over liquors and what the English novelist later recalled as “small bits of bread and cheese”.

It was here, too, above a brothel on the building’s second floor – for even then the neighbourhood was more louche than luxurious – that Cavafy wrote the masterpieces that would make him one of the world’s most translated poets.

After years of neglect, the flat that Forster would remember as “dusky” and “family furnished” has finally been renovated. “The apartment on Rue Lepsius was his creative haven,” says the Cavafy scholar Peter Jeffreys. “This isn’t so much a renovation as a reconceptualisation of a space that realigns Cavafy with the 21st century.”

With the restoration, Cavafy’s “canonisation” – thanks to the Onassis Foundation – also comes full circle in Greece. Amid a revival of interest in the modernist poet, the organisation set up almost 50 years ago by Aristotle Onassis has decided to make the poet’s work more accessible and to shine a light on his global fame.

“We’re giving back to Cavafy the honour he deserves,” said Anthony Papadimitriou, the foundation’s president. “In Alexandria, we have the place where he lived, and in Athens, the things he lived with,” he said, referring to the artworks, furniture, books and personal effects now exhibited in the Greek capital. Housed in a neoclassical building at the foot of the Acropolis, the recently inaugurated Cavafy Archive is home to over 2,000 digitised manuscripts, with poems and handwritten notes, made publicly available for the first time.

For many, the move is long overdue. Greek critics once dismissed the Alexandrian, scornful of his inventive use of the language. Cavafy remains a controversial figure in Greek schools, though secure among the literary greats. The fulsome appreciation given to the poet abroad is absent in Greece, inhibited by his unflinching portrayal of homoerotic desire.

“Greece is not yet ready to see him in the way he is seen elsewhere,” said professor Takis Kayalis who, in his latest book, Cavafy’s Hellenistic Antiquities, explores the lengths to which Cavafy used the ancient past to camouflage and reveal that desire.

“Selections of his poems have been included in Greek schoolbooks since the early 1950s … but these show no trace of his more sensual work. Even some of his most well-known poems, such as Ithaca, have been edited for use in schoolbooks.”

The Onassis Foundation wanted, he said, to project “a more accurate version” of a man who for years had confounded critics with his own “carefully constructed persona”.

Few Greek artists have inspired, influenced or been as imitated as Cavafy. Among creatives – David Hockney and Leonard Cohen included – the poet has exerted a hold that has verged on cult-like. Cavafy was a perfectionist, who obsessively revised his work and never sold a book of poetry in his lifetime. His fame, even for his biggest fans, remains an enigma.

In verse that was terse, unrhymed and often infused with irony, his were themes of loss and defeat as well as amorous pleasure evoked through obscure figures in the forgotten pages of a long lost Greek empire. Cavafy himself categorised his work as “philosophic, historic and sensual”. Fearing scandal, he preferred to circulate it in broadsheets and pamphlets whose publication he tightly controlled.

But WH Auden conceded that there were poems he might never have written had the Greek’s “unique tone of voice” not been known to him. And Hockney, after the discovery of Cavafy at Bradford Library – in a volume that was hidden away and that he later admitted filching – became so enamoured that he would publish etchings inspired by 12 of the poet’s works in 1967, the year homosexuality was decriminalised in Britain because “of course they are about gay love and I was quite boldly using that subject then”.

Worldwide recognition came nearly three decades later when Jackie Kennedy Onassis requested that her favourite poem, Cavafy’s Ithaca, emphasising the importance of the journey over the destination, be recited at her funeral. The reading introduced him to “a global audience that he could never have imagined”, says Jeffreys, whose forthcoming co-authored biography Alexandrian Sphinx: CP Cavafy – A poet’s Life, is to be out next year. To date, there has been only one biography published. For Forster, meeting “the great Greek poet” was among the joys of being stationed in the “ill-built, ill-planned, ill-drained” Egyptian port city when world war took him to Alexandria as a Red Cross volunteer in 1915.

Impressed as much by his polymath friend’s erudition as by his homoerotic verse, the novelist, who had fallen in love with a local tram driver, would famously describe Cavafy as “a Greek gentleman in a straw hat, standing absolutely motionless at a slight angle to the universe”. Already a literary sensation with A Room with a View and Howards End in print, Forster was determined to promote the poet and introduce him to the English-speaking world.

By the mid-1920s, TS Eliot, a supporter of Cavafy’s modernism, had published several of his poems in The Criterion. TE Lawrence had become an admirer, and Leonard Woolf, head of the Hogarth Press, was courting Cavafy with the promise of a £5 advance and 25% of any profits, asking that he “consider allowing us to publish a small book of your poems translated into English”.

“Our books find their way to a small public who would, I think, appreciate your poetry,” Woolf wrote in a letter dated 17 September 1923, now among the manuscripts displayed in the Rue Lepsius apartment.

It is unclear whether Cavafy, who saw himself as a “poet of future generations”, ever replied.

Cavafy’s evening salons came alive to the sound of Greek, French and English spoken by those who, in the words of his friend Yannis Sareyannis, “recognised him as their poet”. No detail, Sareyannis recalled, was too small for the artist who wrote his best works in later life and was often preoccupied with how the house was lit, arranging candlesticks so that the faces of his guests were illuminated while he sat in the shadows.

Rue Lepsius was a far cry from the luxury of Cavafy’s early childhood – years of which were spent in England after the death of his wealthy merchant father. But it was, for Cavafy, ideally located, in the heart of the city whose spirit haunted his works.

The cavernous apartment looked on to St Savvas’s Orthodox church and the hospital that served the Greek diaspora, a community that had long controlled Alexandria’s vibrant commercial life. “Where could I live better?” he asked. “Below, the brothel caters for the flesh. And there is the church, which forgives sin. And there is the hospital where we die.”

It was at the hospital on his 70th birthday in 1933 that Cavafy, a lifelong smoker, drew his last breath after insisting he return to Alexandria after a tracheotomy for throat cancer. The operation, in Athens, deprived him of the voice that so many have described but that was never recorded.

Ever since, devotees, including Hockney, have made the journey to Alexandria. For years the pilgrimage ended at the doors of the Pension Amir, into which the Rue Lepsius apartment had been converted, a place described by Lawrence Durrell, also brought to the city by war a generation later, as “modest and somewhat seedy”.

In 1992 the flat was transformed into a museum by the Greek consulate. Durrell, like Forster before him, saw Cavafy as one of Alexandria’s significant figures with the poet featuring in his magisterial Alexandria Quartet. Of the “city’s exemplars”, he wrote, there was “Cavafy, Alexander, Cleopatra and the rest”.

But it was not always so. In his lifetime, Cavafy was the butt of gossip and, in the words of Sareyannis, numerous and violent attacks. “In his city, and particularly within his class, there prevailed an imitation of Victorian morality of the most narrow-minded, anti-aesthetic kind,” the younger Greek later said. “In such an atmosphere, a scandal such as that of Oscar Wilde could easily have been repeated.”

For years, travellers to Rue Lepsius were met with disbelief. Now incredulity has been replaced by pride. Local authorities have renamed the street CP Cavafy. Alexandria’s Metropole hotel, which once housed the irrigation office of the ministry of public works, where Cavafy was employed as a clerk, advertises a suite where it says “the 20th century’s most distinguished Greek poet in Europe” worked.

“Cavafy was very brave,” said Mohammed Elsayed, the caretaker who has watched over the Rue Lepsius apartment for more than three decades.

“He wrote the truth, he lived his life. Before, there were few Egyptians who would stop by. Now there are so many, and they enjoy and understand what he is: a world poet.”

• This article was amended on 10 July 2024 to clarify that Peter Jeffreys has co-authored Alexandrian Sphinx: CP Cavafy – A poet’s Life