By all that is holy and ///M, please do as some previous posters are advising and walk away.
Back in college I had a river flow into my car (bad rains in Kansas), just up over the rocker panels. Soaked the carpets, but the electronics stayed intact, I was hoping... Next morning I pitched the mats and furiously wet-vacced, left the doors open and camped with the car when I could. About a week after, I shampooed everything, even the cloth seats, though they were unaffected. Long story short: seems like every sunny day after that rain, for as long as I owned the car, it smelled like mud with the barest hint of fish. And that was FRESH water.
Salt water does some devious things to cars, to echo what was said above: corrosion, shorting out delicate electronics...and it probably isn't going to show up for 6 months to a year. I know you're trying to help out your friend, but I truly can't see paying even over $10k for a flood-titled M3 (and then just cannibalizing it for parts). There's a good reason the runways at Calverton on LI are still full of Sandy-damaged vehicles, three months on.
Track car? Not a bad idea at all. At least you won't have to walk far when otherwise inexplicable things start happening and then it outright dies.