Personally I like the A-B neighborhoods, south of the mason dixon line (the winters aren't as harsh), because it's a safer more consistent investment with the rental clientele you're working with and it's almost guarantee'd you'll get every dollar invested back, of course if you buy the right deal.

I am going to look into this alternative to the traditional ways of getting motivated seller leads!

Also, do you think it’s a little safer to sub to into a brrr? 

This might be an alternative that solves your immediate problem and also provides a much, much needed solution in the community.

Alternatively, what's the best way for my friend to get their funds back without any tax implications (if any) for him and business?

Alternatively, if you know of a mentor you could recommend, I would greatly appreciate it.

Take a look at the alternative.....if there was NO incentive for a property management company to get a renewal because they do not charge a renewal fee.....why are they going to seek one?  

Alternatively, you could try cash for keys.

Alternatively, you may explore the stability of long-term rentals or the convenience of Real Estate Investment Trusts (REITs) for a more hands-off investment approach.

Alternatively, many owners are currently motivated and might offer competitive financing.These would not be value add properties, which do notwant, but those in good maintainable shape.