Overlay topology design has been one of the most challenging research areas over the past few years. In this paper, we consider the problem of finding the overlay topology that minimizes a cost function which takes into account the overlay link creation cost and the routing cost. First, we formulate the problem as an Integer Linear Programming (ILP) given a traffic matrix in case of cooperative and non cooperative node behavior. Then, we propose some heuristics to find near-optimal overlay topologies with a reduced complexity. The solutions of the ILP problem in average-size networks have been analyzed, showing that the traffic demands between the nodes affects the decision of creating new overlay links. The heuristics are also compared through extensive numerical evaluation, and guidelines for the selection of the best heuristic as a function of the cost parameters are also provided.