The error message you’re seeing suggests that Unreal Build Tool (UBT) is unable to create a directory at the specified path because it doesn’t have the necessary permissions. One potential solution is to try running UBT with administrator permissions. You can do this by launching the Epic Games Launcher as an administrator.
Another solution could be to try running the command in the terminal. You can do this by opening the terminal, navigating to the directory where you want to create the project, and then running the command “UnrealEngine/Engine/Build/BatchFiles/Mac/Build.sh YourProjectName”
It is also possible that the problem is related to the path of the directory, this could be a bug related to the new architecture of the M1 chip, you could try creating the project on a different location, or creating the project via the editor instead of command line.
If none of the above solutions work, it’s possible that there is a bug in the version of Unreal Engine you’re using that is preventing it from working correctly on Macs with M1 processors.