Thats rather unfortunate and this property may just be a loss. Was it owned free in clear (minus a mortgage)? If not, he's going to owe the principle amount to the lender regardless of whether the property inhabitable or not. Without the proper property insurance the city owes your friend nothing. In fact, he may actually end up owing the city for any services they have provided thus far (i.e. cleaning, demo, securing etc). To add insult to injury they can even impose a lien on the property for lack of payment. However, it is possible that the lot/property could still be sold and some of his money recooped. If he is interested in doing this please contact me. I actually specialize in selling problem properties much like the one your friend owns. I also deal with plenty investor who would be interested in seeing his property and even submitting an offer to purchase. You can reach me via email firstname.lastname@example.org or phone 2156815520. Best regard and I wish him luck.