We define a proximity overlay network (PON) which allow to realize DHT systems whose aim is to combine routing efficiency – i.e. an optimal degree/diameter tradeoff – and proximity awareness. The proposed systems is parameterized with a positive integer s which measures the amount of flexibility offered by the network. Varying the value of s the system goes from a quite rigid network (s = 2) which offer an optimal degree/diameter tradeoff. Increasing s to relatively low values allows to increase the flexibility of the network and consequently improves the stretch, that is, the ratio between the latency of two nodes on the overlay network and the unicast latency between those nodes. We are able to reconcile the conflict between the load balancing and proximity relationship by proving the efficiency of the main performance metrics. In particular we analytically prove that our system can result in lookup latencies proportional to the maximum latency of the underlying physical n...