A multimillion-pound luxury penthouse flat named after the revolutionary socialist thinker Friedrich Engels is the latest example of Manchester repurposing its radical history for profit, local people have said.

The apartment is in the east tower in Deansgate Square, where the developer Renaker says its vision for the “New Jackson” skyscraper district “is to create a sustainable and attractive neighbourhood where people feel proud to call home”.

The tower stands just off Deansgate, in what was once a slum area of Manchester, where families lived in squalid and cramped homes, and grinding poverty. It is also just a few hundred metres from a statue of Engels, which stands outside the Home arts centre.

The German philosopher spent more than two decades in Manchester in the mid-19th century, from where he researched his seminal work The Condition of the Working Class in England.

The book is a study on the Victorian industrial working class, which highlighted the issue of overcrowded housing, as well as high mortality rates and poor working conditions.

Today, there is incredibly high demand for affordable housing in Manchester, with more than 15,000 applications on the waiting list for social housing.

According to the property website Rightmove, the average price for a property in Manchester is £300,521, with the average selling price for flats at £200,652.

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The 290 sq metre (3,126 sq ft) flat is listed on the developer’s website as a showhome, but in promotional material it was advertised with a price tag of £2.5m.

A second penthouse apartment, “The Turing” – presumably named after the University of Manchester computer scientist Alan Turing – is also on the market for £2.5m.

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“It’s just another iteration of that thing that Manchester’s been very good at doing, which is reabsorbing radical elements of its history into a brand,” said Isaac Rose, from Greater Manchester Tenants Union.

“[Engels] deliberately fled the life of the bourgeoisie to live and be among the working class, but maybe he’d have found it ultimately amusing that things have got this mad that they were naming penthouses after him.”