I know that the general guidance is that emergency funds aren't to be invested, but given our financial security and the fact that we already have a personal e-fund in a safe, non-volatile location, would it still be crazy/unwise to invest this 15k in an S&P500 index fund in a brokerage? 

This includes preparing the property for renters, pricing it right, marketing, application screening, collecting rent, dealing with unpaid rent and other lease violations, security deposit disposition, inspections, and so much more.

However, the journey has been anything but smooth, and we are now at a critical crossroads.Despite securing approval for our 42 townhouses, the soaring construction costs have made the project financially unfeasible.

With the future being so uncertain I realized there was a need to do more than just rely on my job for financial security. 

Our lease contains a clause stating the security deposit cannot be used for the last month's rent. 3.

Loan Security: The property will serve as collateral for the seller-financed loan.

The vast majority of lawsuits against Landlords are for wrongful eviction, security deposit disputes, and Fair Housing Violations.

Separate accounts per property incurs a lot of overhead, such as minimum balances or fees for missing the minimum.I use separate accounts for each tenant's security deposits.

Unless the medical condition meets the state criteria for early termination and that the medical notice does not appear to suggest that, you cannot terminate the lease outright/immediately but that you will begin to market the property for rental and upon securing an acceptable tenant, the lease can be terminated pending a satisfactory property walkthrough indicating no damages. 

Using a HELOC or home equity loan on your personal home could be a good option, especially if you can secure a low interest rate and manageable terms.