Is it permissible, Islamically, for a person to ask his friend, from whom he borrowed building materials, to pay him their value in cash after he (the borrower) buys new materials, knowing that the friend paid in cash after buying the new materials?

The general rule is that debts are repaid with their equivalents. However, if the time for repayment comes and the equivalent is not available, or if the creditor and debtor agree to settle with the value, then there is no impediment. It is stated in Kashshaf Al-Qina': "The borrower must return the equivalent in a loan of measurable or weighable items, whether its value has increased or decreased since the time of the loan. If the equivalent becomes unavailable and cannot be found, the borrower must repay its value on the day it became unavailable, because at that point, it becomes a fixed liability." In addition to unavailability, the lender and borrower may mutually agree on the value. Therefore, there is no impediment for the debtor to repay the value of his debt, as long as the creditor has consented to it.