This error is thrown when it's not possible to connect to the SFTP server because the server is not responding to our connection attempts. Common causes of this are unreachable server or bad server port (SFTP runs on TCP port 22 by default). Another possible cause is that the server only supports FTP and FTP/SSL which are different protocols and run at different ports (use Rebex FTP/SSL for these).
Are you able to connect to the server using any third-party SFTP client?