How to Troubleshoot Steam Stuck at “Reserving Space”
Symptoms
On both OS, the problem seems to be happening more often with Steam Library saved on external drives, usually SSDs formatted exFAT. On Mac, soon as Steam starts “reserving space”, Steam client gets stuck and unresponsive. This usually results in Finder failure, —probably due to Steam hanging the entire filesystem— which then can only be remedied by the reboot. On reboot, Steam will not load at all and be stuck on the loading screen.
I was lucky enough to avoid this problem on Windows, but from what I can gather, the exact same problem can happen on a PC. Steam tries to reserve space on external drive, SSD formatted exFAT, but hangs.
Workaround
On macOS version of the Steam, the client simply won’t load with the external drive attached. Steam client will try to automatically start the update again and that’s not what we want. Removing the drive will allow Steam to load normally, and that’s a good starting point.
The most obvious and recommended solution of it all is not to use exFAT for Steam storage. It appears the “fix” to the problem is to use NTFS for Windows and APFS for macOS until there is an official fix from Valve.
Neither filesystems are natively supported on each other OS, so in my case, I ended up partitioning the drive a bit thoroughly. What I ended up doing was resizing existing exFAT volume and moved the data to newly created three partitions (NTFS, APFS, exFAT, for Windows, macOS, and for in-between). There is a software on Windows called DiskGenius, and there is also a free version. You could also create or convert to one NTFS partition, then use a software such as NTFS for Mac.
Ultimately, it seems to be up to the Valve for the actual fix. I find it odd that Valve didn’t update to support exFAT more reliably. Perhaps there is more to the problem than it meets the eye, but nonetheless, saving a game on an external flash storage is a new norm.