SHTF is a fundamental reason. However, depending on individual circumstances, I wouldn't advise acting on it.
A $40M portfolio (I assume we're talking US$) implies that the holder is in position to choose their lifestyle. If they do not wish to administrate real property or be tied to it, then ETFs are a legitimate vehicle. By design, they closely reflect the value of the underlying securities. They're similar to mutual funds in being relatively liquid, with some additional liquidity advantages. Either mutual funds or ETFs can provide performance similar to global equity markets as a whole or any slice of global equity markets that the owner chooses. So they're excellent in producing a lifestyle where responsibilities and decisions are limited to the digital/financial realm.
Is the choice to go all-financial/all-digital unwise? I suppose an all-financial portfolio could be stolen or blocked by hackers, insiders or other parties. That's a risk separate from STHF, and one that real property is probably not subject to.
Some of the decision depends on what laws the owner is subject to. I read that as a side effect of recent tax collection laws/regulations, American citizens are less free to buy securities from global locations than we used to be - but you probably know a lot more about that than I do. Likewise you probably know more about the tax laws related to your friend's portfolio. I suspect those make more difference than any of these other factors.
For some people, there's never been a time when a huge fortune could be so liquid so easily as the last 10-15 years. I understand some of your distrust though. Some coutnries' citizens can't easily have liquid fortunes, so they amass property. Property is harder to seize across borders. International authorities can freeze bank accounts more easily than they can seize apartments or other real estate. Plus laws can change at the drop of a hat.
I guess your friend has to judge the risks for his/her situation, compare to his/her values, and act accordingly.
Curious what other thoughts on this you develop or would care to share.