I got a recommendation for Hotel Platino, located close to the heart of Santiago on Estrella Sadhala Avenue. Rooms start around US $35 dollars per night with an average room rate of US $77 dollars. They can be reached at 1-809-724-7576 As always, guest policies vary. So call ahead to inquire.
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There is a gay club in Santiago. It's fairly new so I haven't heard much about it. The Krash Vogue Club House is located on Avenida 27 de Febrero in front of Banco Santo Cruz.
A nice way to sample the city may be to take an overnight excursion. The Caribe Tours bus from Santo Domingo to Santiago is about US $8 dollars. 1-809-221-4422While there you could check out the Carnaval Mask Museum and the local falls and beaches.
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