DHT-based peer-to-peer (P2P) overlays significantly reduce the overlay traffic that is needed to locate a random object on the overlay network. However, DHT-based overlays are often largely oblivious to the underlying physical network and only assign second-rate effort to the exploitation of physical proximity. Hence, a single overlay hop often amounts to an unnecessarily large number of physical hops. While this might at best be considered inefficient in stationary networks, it could prove disastrous in mobile (and wireless) networks, thus, effectively limiting the deployability of P2P overlays on top of mobile and wireless networks. We present an approach that forms clusters in DHT-based P2P overlays based on physical proximity. By grouping physically close nodes into common overlay clusters, we can decrease the number of physical hops per overlay hop. Thus, the amount of physical traffic generated by overlays deployed on top of mobile and wireless ad-hoc networks can be reduced significantly.