It turns out the reason for this error message was the Project and Library folders were located on a mapped drive. The BIM Server services did not have enough authority to write to these locations. I have requested that we improve the error message to reflect this particular problem.
Although it is possible to grant the BIM Server services higher authority using the Services panel in Windows or changing the administrative group permissions or executable permissions of the daemon in Mac OS X, it is in general better to avoid mapped drives, for performance reasons. Often mapped drives are located on external devices that have less bandwidth than locally attached devices and often lower access speed. The overall performance of the BIM Server is directly related to how quickly it can read and write data to its databases.