Jim, nice quality new home construction in my region is running about $125/sq.ft. so personally, that would not necessarily surprise me, as often remodel/addition cost is actually higher.
For one large room with no kitchen or bath, it does sound exorbitant at first, but there are a lot of factors to consider; enlargement of HVAC systems, the difficulty of the tie-in, interior and exterior finishes, etc.
You're doing the right thing; check around to compare bids, and then compare contractors. Be sure you choose your contractor not just for price, but also for the quality of work he/she does. Good luck