error: server side activities have been updated you need to restart sharepoint designer

You need to install the January 12, 2016, update for SharePoint Designer 2013 (KB3114337). it fixes that issue:

When you try to create a SharePoint 2013 workflow in SharePoint Designer 2013 on a computer that has Microsoft.Activities.dll installed, you receive the following error message:
Server-side activities have been updated. You need to restart SharePoint Designer to use the updated version of activities.

Before installing this package you must first install the prerequisite Microsoft SharePoint Designer 2013 Service Pack 1.

https://support.microsoft.com/en-us/help/3114337/january-12–2016–update-for-sharepoint-designer-2013-kb3114337