Cost Plus Construction Loan to include Lot Price?

[Chase Judd]

I am looking at buying a lot and building new, from the ground up. A home builder owns the land. In his contract to sell, he stipulates that his company will be the builder on a cost plus building fee. He stipulates that the price of the land purchase will be included in the cost plus fee. This doesn't seem fair to me. Am I wrong that this should not be included in his cost plus build price?