That is way too many bucks, unless its new, like with a manufacturers warranty. I had a turbo rebuilt for not much more than thet at Majestic Turbo, in Waco, TX.
see: http://www.majesticturbo.com
I believe the '85 300SD uses a year-specific turbo that is oriented to fit the intake manifold and exhaust that attaches to a trap oxidizer. Or am I thinking of the CA cars? I know CA cars are different for certain, and turbos in the '85 300D are different for that year production. Not a big deal, if you can't find a good used one for your mechanic to install, get yours rebuilt.
A good used turbo should run $75 to $150 max from a wrecking yard and labor would run $150 to $300. As always, YMMV
Dieseldiehard