Hi Jerry - Thanks for posting - and thanks for caring about your friend enough to search out advice! First of all, treat him no differently than you have in the past - other than to begin to see him/her as she or he wishes to be seen. Was he a man transgendering to a woman or vice versa? And have an honest conversation with him as to what he needs and would like from you. Know that he is the same person inside.
You can direct your friend to support groups. We've had a very active person on this site who has provided a great deal of information and links in the transgender subforum below.