A popular Syrian restaurant in Toronto which had been due to close after its owners received a wave of death threats will stay open after an outpouring of support from neighbours and local businesses, in the latest twist of saga that has exposed the steady polarization of Canadian politics.

Soon after the Al-Soufi family emigrated to Canada in 2015, they launched a restaurant, Soufi’s, in downtown Toronto, which won international acclaim not only for its menu, but also its commitment to help newly arrived Syrian refugees adapt to life in Canada. In a glowing profile, the New York Times held up the restaurant as an emblem of “Canada’s embrace of the Syrian refugees”.

Earlier this week, however, the family announced the restaurant would permanently close following a barrage of death threats after the owners’ son was involved in an altercation outside a far-right politician’s campaign event.

“Our decision is made with a heavy heart in effort to maintain our family and staff’s safety,” the owners said.

The announcement prompted despair among fellow Syrian immigrants, said Bayan Khatib, executive director at the Syrian Canadian Foundation.

“They were a success story for all of us. They were an example of successful integration and of giving back,” she said.

The threats against the family were linked to a decision by the owner’s son Alaa to attend a political protest in September.

Alaa had travelled to the city of Hamilton to join a demonstration outside a rally for a far-right populist candidate, Maxime Bernier, whose fringe People’s Party of Canada has been described as xenophobic and racist.

But the protesters came under criticism after several of them were filmed blocking an elderly couple from crossing the street to attend the rally.

Footage of the incident, which was viewed online more than 7 million times, showed one of the protesters shouting “Nazi scum, off our streets!” at the couple.

Dorothy Marston, 81, and her husband, were only able to enter the rally with the help of police. “They were … treating me like I’m a criminal,” she told CBC News.

One of the protesters, wearing a black ski-mask and orange T-shirt, was identified as Alaa Al-Soufi – the son of the restaurant owners. He does not join in the abuse but can seen standing in Marston’s path.

Supporters of Bernier “doxxed” Alaa, releasing his personal information online – and his family’s restaurant became the target of a wave of hate messages.

The family said in a statement earlier this week that Alaa “did not in any way verbally or physically assault the elderly woman and has nonetheless offered to apologize personally for not doing more”.

By then, however, the posts about the family, including the address and telephone numbers, were being widely shared on far-right and anti-immigrant Facebook groups.

On Tuesday, the family announced that they were permanently closing their business, adding: “The magnitude of hate we are facing is overwhelming.”

The Syrian Canadian Foundation, where Alaa had volunteered, was also targeted with “violent and disgusting” hate mail, said Khatib.

But the family’s plight also prompted an outpouring of support, and on Thursday they announced the would reopen.

At a press conference outside the restaurant, Husam Al-Soufi told reporters that the decision to close “came from a place of fear” – but the outpouring of support had inspired the family to continue serving the city.

Mohamed Fakih, a Toronto-based businessman who has made a high-profile effort to hire Syrian staff at his restaurant chain, pledged to support the family’s business.

“We’re going to send a message that hate will never win in Canada,” he said.

Police have now opened an investigation into the threats, the family has said.

The family felt like they had the strength to come back because of all the love and support they got,” said Khatib. “In this case, the good is bigger than the bad.”