Do you have partitions on your Hard Disc or more than one Disc in your PC?
I've Found a similar problem on the internet where the installation tries to use a Temporary Folder from a Disc with no space available. Only it was with the patch 1.07.
Here is a discussion: https://steamcommunity.com/app/292030/discussions/0/535151589886190298/ where its last answer concerned the Temporary Folder:
Do a hard drive test on both hard drives, just in case.
Otherwise, you said you have 2 disk drives. How much space is left on
your other disk drive? Is that where Steam is installed? If not,
perhaps Steam is using system temp folder for what ever reason, and
you do not have enough disk space on that drive. Here are
1. Right click on Computer and click on Properties. In the resulting window with the basic information about your computer
2. Click on Advanced system settings on the left panel resulting in a dialog box click on the Advanced tab a
3. Click on the button near the bottom labeled Environment Variables.
4. You may see both TMP and TEMP listed in the section labeled User variables for (account). That's the common location; each different
login account is assigned its own temporary location.
5. In the Variable value Edit box you may specify the path to the directory that Windows and many other programs will use for temporary
Be sure and repeat that process for both TMP and TEMP. You'll need to
restart any running programs for the new value to take effect. In
fact, you'll need to restart Windows for it to begin using the new
value for its own temporary files.
And a video about changing the temporary folder:
and the installation working.
Hope it helps