Waldvogel et al. [10] have proposed a collection of hash tables (CHT) organization for an IP router table. IP lookup can be done with O(log l_dist) hash-table searches, where l_dist is the number of distinct prefix-lengths (also equal to the number of hash tables in the CHT). Srinivasan and Varghese [9] have proposed the use of controlled prefix-expansion to reduce the value of l_dist. The algorithm of [8] does not minimize the storage required by the prefixes and markers for the resulting set of prefixes. We develop an algorithm that minimizes storage requirement but takes O(nW³ + kW⁴) time, where k is the desired number of distinct lengths, n is the number of prefixes, and W is the length of the longest prefix. Also, we propose improvements to the heuristic of [8].