The Arbor is the space between 123 Sesame Street and Hooper's Store which houses a structure that started as a community garage. The area — which has also been referred to as a courtyard, or simply the yard — has gone through many changes over the years.
During the first season, when the street was straight, this area was confined simply by a tall fence with a palm tree painted on it. The space was occupied by some lawn chairs where stories would sometimes be read.
When the show went into its second season, the street was curved, expanding the area. At first, the arbor included a tall fence next to Hooper's Store separating the area from a simple backdrop of apartment buildings in the distance, and a tower with the alphabet painted on it.
In the late 1980s, the background was gradually updated. By 1989, more distant buildings were added, and the alphabet tower was converted to a set structure that stood behind the garage (and was later repainted gray when the set was cleaned up and brightened in 1993).
The fence was shortened in 1998, and the backdrop was replaced with a small two-story apartment building. The alphabet tower made way for another apartment building, and a small community garden was added in between the garage and 123.
In 2008, a larger garden was added, and the large crates were removed.
The small building at the back end of the arbor has also gone through several changes. It originated mostly as a multi-purpose storage space for the neighborhood, and also housed Susan's Volkswagen. In 2001, Gina opened up her own veterinary practice in the building, as seen in Episode 3918. In Season 39, it was converted into "Charlie's Auto Repair", and in Season 46 the building became a community center.